Question
Retirement Problem. ONLY SOLVE D or d A client met with a financial consultant to figure out how much she will need to save in
Retirement Problem. ONLY SOLVE D or d
A client met with a financial consultant to figure out how much she will need to save in order to secure her retirement. There are several scenarios that the financial planner will consider.
a) In exchange of getting paid $30,000 for 8 years starting the beginning of year 6 (i.e., she will get paid $30,000 in the beginning of year 6, 7, and so on for 8 years), she agrees to set aside $x for 5 years, starting now (beginning of year 1, 2, 3, 4, 5). The interest rate is 8%. What is $x?
d) Assume interest rate is 8%, and everything else is as in a) except that the client actually has some savings to contribute to the retirement. Specifically, she will allocate $50,000 to retirement in the beginning of year 1 (In the retirement problem, account balance beginning of year 1 is $50,000). Solve for $x.
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