Using the information below, answer the following questions:

Annual Retirement Income Need	150,000
Years until Retirement	30
Years in Retirement	35
Expected Inflation Rate	2.50%
Rate of Return before Retirement	8.00%
Rate of Return during Retirement	5.00%

How much money will you need to have accumulated at the time of retirement to be able to meet your income needs during retirement?

If you were to make a single lump sum investment today, how much would you need to invest to meet your goal at the time of retirement?

If you were to invest an equal dollar amount each year, how much would you need to invest annually to meet your goal at the time of retirement?

Determine the price of a share of stock whose last annual dividend payment (D₀) was $1.50, assuming a required rate of return of 12% and considering the following:

The dividend payment is expected to remain constant (i.e., g = 0) indefinitely.

The dividend payment is expected to grow at a constant rate of 3% per year indefinitely.

The dividend payment is expected to grow at a rate of 8% for four years and then immediately decline to 3% indefinitely. See formula 9-5 on page 260 of the book.

You are considering the following bonds to include in your portfolio:

	Bond 1	Bond 2	Bond 3
Price	$900.00	$1,100.00	$1,000.00
Face Value	$1,000.00	$1,000.00	$1,000.00
Coupon Rate	7.00%	10.00%	9.00%
Frequency	1	2	4
Maturity (Years)	15	20	30
Required Return	9.00%	8.00%	9.00%

Determine the highest price you would be willing to pay for each of these bonds using the PV function. Also find whether the bond is undervalued, overvalued, or fairly valued.

Determine the yield to maturity on these bonds using the Rate function assuming that you purchase them at the given price. Also calculate the current yield of each bond.