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Mr. Paul is at the age of 25, and his friend David (an insurance/mutual fund broker) offered him a retirement savings plan investment opportunity. Please
Mr. Paul is at the age of 25, and his friend David (an insurance/mutual fund broker) offered him a retirement savings plan investment opportunity. Please help Paul to calculate his annual contribution (payment) for the financial product based on the following information.
- Paul starts to contribute XXXX Canadian dollar next year at the age of 26, same amount for consecutive another 19 years contributions;
- When Paul finishes his annual contributions at his age of 45 years, Paul will leave the investment in the insurance company for further growth of the investment amount;
- When Paul retires at the age of 65, Paul can get amount of Cnd$20,000 for 20 years when Paul turns to the age of 85;
- David/Insurance company assume the annual return is 5.5%
Please do the calculation (suggest to draw the timeline for this case) illustrate the numbers based on time value calculations step by step; 30Marks
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