Hi,

Kindly assist with the following:

1)

GradyZebrowski, age25, just graduated fromcollege, accepted his first job with a $47,000 salary, and is already looking forward to retirement in 40 years. He assumes a 3.6 percent inflation rate and plans to live in retirement for 20 years. He does not want to plan on any Social Security benefits. Assume Grady can earn a 10 percent rate of return on his investments prior to retirement and a 7 percent rate of return on his investmentspost-retirement to answer the following questions using your financial calculator.

a.Grady wants to replace 90 percent of his current net income. What is his annual need intoday's dollars?

b.Using the table, Grady thinks he might have an average tax rate of 13 percent at retirement if he is married. Adjusting fortaxes, how much does Grady really need peryear, intoday's dollars?

(Table)

TABLE 16.2 The Average Tax Rate Average Tax Rate Retirement Income Couples Filing Jointly Individuals $20,000 7% 10% 30,000 10 14 40,000 12 17 50,000 14 20 60,000 17 22 70,000 19 23 80,000 21 24 90,000 22 25 100,000 23 26 150,000 28 30 Note: To estimate your anticipated average tax rate at retirement, you can use the table above based on current tax rates. If you anticipate a change in future tax rates-for example, a flat tax-use that number