Question
Future value of a portfolio.Rachel and Richard want to know when their current portfolio will be sufficient for them to retire. They have the following
Future value of a portfolio.Rachel and Richard want to know when their current portfolio will be sufficient for them to retire. They have the following balances in their portfolio:
Money market account (MM):$36,000
Government bond mutual fund (GB):$125,000
Large capital mutual fund (LC):$103,000
Small capital mutual fund (SC):$71,000
Real estate trust fund (RE):$88,000
Rachel and Richard believe they need at least $2,500,000 to retire. The money market account grows at 2.0 % annually, the government bond mutual fund grows at 5.5 % annually, the large capital mutual fund grows at 10.0% annually, the small capital mutual fund grows at 13.0% annually, and the real estate trust fund grows at 3.0% annually. With the assumption that no more funds will be deposited into any of theseaccounts, how long will it be until they reach the $2,500,000 goal?
Rachel and Richard will need to invest their accounts for _____ or more years to reach $2,500,000. (Round to the nearest whole number.)
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