Question
QUESTION 8 Sumaya (52) will have a shortfall of R8 000 000 at retirement. She plans to retire at 60. To address the shortfall, she
QUESTION 8
Sumaya (52) will have a shortfall of R8 000 000 at retirement. She plans to retire at 60. To address the shortfall, she will contribute an annual lump sum from her bonus, which is expected to increase by 4% annually, to her pension fund. This year her contribution will amount to R150 000. Assume an annual investment growth of 6% until retirement. What will the present value of Sumayas contributions at retirement be? Use 5 decimals for the calculation, and round the answer to the nearest rand.
a. R1 129 799
b. R987 357
c. R1 123 676
d. R1 017 956
e. None of the above.
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