Mark saves a fixed percentage of his salary at the end of each year. This year he saved $ 4089. For the next 5 years, he expects his salary to increase at an 8% annual rate, and he plans to increase his savings at the same 8% annual rate. He invests his money in the stock market. There thus will be six end of year investments. Solve the problem by using the geometric gradient factor

How much will the investment be worth at the end of the six years if they increase in the stock market at a 13% annual rate? The answer is close to

Select one:

40487

19447

25514

53119

Question text

Mark saves a fixed percentage of his salary at the end of each year. This year he saved $ 3408. For the coming years, he expects his salary to increase at an 8% annual rate, and he plans to increase his savings at the same 8% annual rate. He invests his money in the stock market. There thus will be 6 end of year investments. Solve the problem by using the geometric gradient factor.

How much will the investment be worth at the end of that period if they increase in the stock market at an 8% annual rate? The answer is close to

Select one:

18933

973

30045

613

Question text

The MacIntosh Company has an employee savings plan that allows every employee to invest up to 6% of his or her annual salary. The money is invested in company common stock with the company guaranteeing that the annual return will never be less than 8%. Jill was hired at an annual salary of $45961. She immediately joined the savings plan, investing the full 6% of her salary each year. If Jills salary increases annually at an 8% uniform rate, and she continues to invest 6% of it each year, the amount of money she is guaranteed to have at the end of 14 years is close to

Select one:

104997

1749953

35747

595791