Lynn Price recently completed her MBA and accepted a job with an electronics manufacturing company. Although she likes her job, she is also looking forward to retiring one day. To ensure that her retirement is comfortable, Lynn intends to invest $3,000 of her salary into a tax-sheltered retirement fund at the end of each year. Lynn is not certain what rate of return this investment will earn each year, but she expects each years rate of return could be modeled approximately as a normally distributed random variable with a mean of 12.5% and a standard deviation of 2%.

A. If Lynn is 30 years old, how much money should he expect to have in her retirement fund at age 60?

B. Construct a 95% confidence interval for the average amount Lynn will have at age 60.

C. What is the probability that Lynn will have more than $1 Million in her retirement fund when she reaches 60?

D. How much should Lynn invest each year if she wants there to be a 90% chance of having at least $1 million in her retirement. Use goal see in the @ risk tab.

E. Suppose that Lynn contributes $3,000 annually to her retirement funds for eight years and then terminates these annual contributions. How much of her salary would she have contributed to this retirement plan and how much money could she expect to have accumulated at age 60?

F. Now suppose that Lynn contributes nothing to her retirement fund for eight years and then begins contributing $3,000 annually until age 60. How much of her salary would she have contributed to this retirement plan and how much money could she expect to have accumulated at age 60?

G. What should Lynn (and you) learn from the answers to questions e and f?