Today, Junior turns 30 years old. Junior also starts a new job today. His monthly net salary, payable

at the end of the month, is Ghc2,000. Juniors boss was impressed by Juniors competencies during

the interview and has offered him a monthly raise of 0.1%, effective as of Juniors second month on

the job.

Exactly 10 years ago, Junior bought a condo, valued (as of ten years ago) in Ghc 150,000. Junior

made a Ghc 20,000 down payment and contracted a mortgage with a 5-year term and a 25-year

amortisation period. All due mortgage payments have been paid with an undisclosed revenue

source (that revenue source is not relevant for this problem). Junior has since renewed his

mortgage, but keeping the exact same conditions. Therefore, the 4% APR mortgage rate

(compounded every six months) remains the same, and should not change in the future.

Mortgage payments are due at the end of each month. Juniors average monthly expenses (not

including mortgage payments) are currently Ghc 750, but Junior expects his monthly expenses to

grow at an effective annual rate of 1% starting next month (i.e. Juniors second month on his

new job). Juniors expenses will continue to grow at that rate until Junior retires. There are no

other expenses. Junior saves 80% of his disposable income (that is, his salary minus expenses

and mortgage payment).

Junior invests all his savings in a security that guarantees a 6% effective annual return. Besides

the savings described here, Junior has no other savings. The adequate rate of return to calculate

the present and future value of cash flows is 6%, annual effective.

On the day Junior turns 65 years old, he will retire and sell his condo (price: Ghc 175,000).

Junior will invest all his accumulated savings and the proceeds from the sale of the condo in a

security that guarantees a return of 3% effective annually. Junior is convinced that he will die on

the day of his 88th birthday. He wishes to leave a Ghc 100,000 bequest to the Lost Cats Trust.

Junior will also buy one gold ring on each of his 75th and 85th birthdays. Each ring costs Ghc

10,000.

Given his financial situation, what will be Juniors monthly gross revenue (i.e. before expenses)

during retirement if we assume that Junior wishes this monthly revenue to be constant? Junior

lives in a tax paradise where the tax rate is zero percent (0%)