Please answer all parts of the question:)
Grady Zebrowski, age 25, just graduated from college, accepted his first job with a $49,000 salary, and is already looking forward to retirement in 40 years. He assumes a 2.1 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 investments post-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 in today's dollars? b. Using the table B Grady thinks he might have an average tax rate of 13 percent at retirement if he is married. Adjusting for taxes, how much does Grady really need per year, in today's dollars? c. Adjusting for inflation, how much does Grady need per year in future dollars when he begins retirement in 40 years? d. If he needs this amount for 20 years, how much does he need in total for retirement? e. How much does Grady need to save per month to reach his retirement goal assuming he does not receive any employer match on his retirement savings? Click on the table icon to view the FVIF tableClick on the table icon to view the PVIFA tableClick on the table icon to view the FVIFA table TABLE 16.2 The Average Tax Rate Average Tax Rate Retirement Income Couples Filing Jointly $20,000 79 30,000 10 40,000 12 50,000 14 60,000 17 70,000 19 80,000 21 90,000 22 100,000 23 150,000 28 Individuals 10% 14 17 20 22 23 24 25 26 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 Compound Sum of $1 (FVIF) n = 20 n = 40 2.00% 1.4859 2.2080 2.10% 1.5154 2.2963 2.20% 1.5453 2.3880 2.30% 1.5758 2.4833 2.40% 1.6069 2.5822 2.50% 1.6386 2.6851 2.60% 1.6709 2.7919 2.70% 1.7038 2.9028 2.80% 1.7372 3.0180 2.90% 1.7714 3.1377 3.00% 1.8061 3.2620 3.10% 1.8415 3.3911 3.20% 1.8776 3.5252 3.30% 1.9143 3.6645 3.40% 1.9517 3.8091 3.50% 1.9898 3.9593 3.60% 2.0286 4.1152 3.70% 2.0681 4.2771 3.80% 2.1084 4.4452 3.90% 2.1494 4.6198 1.90% 2.00% 2.10% 2.20% 2.30% 2.40% 2.50% 2.60% 2.70% 2.80% 2.90% 3.00% 3.10% 3.20% 3.30% 3.40% 3.50% 3.60% 3.70% 3.80% 3.90% 4.00% 16.5103 16.3514 16.1947 16.0402 15.8878 15.7374 15.5892 15.4429 15.2986 15.1563 15.0160 14.8775 14.7409 14.6061 14.4731 14.3419 14.2124 14.0847 13.9586 13.8342 13.7115 13.5903 27.8414 27.3555 26.8818 26.4200 25.9698 25.5309 25.1028 24.6853 24.2780 23.8807 23.4930 23.1148 22.7456 22.3853 22.0336 21.6903 21.3551 21.0277 20.7080 20.3958 20.0908 19.7928 Monthly Installment Loan Tables ($1,000 loan ith interest payments compounded monthly) n = 240 n = 480 6 462.0409 1991.4907 7 520.9267 2624.8134 8 589.0204 3491.0078 9 667.8869 4681.3203 10 759.3688 6324.0796 11 865.6380 8600.1272 12 989.2554 11764.7725 COO
