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When Jamal graduated from college recently, his parents gave him $1,110 and told him to use it wisely. Jamal decided to use the money to
When Jamal graduated from college recently, his parents gave him $1,110 and told him to use it wisely. Jamal decided to use the money to start a retirement account. After doing some research about different options, he put the entire amount into a tax-deferred IRA that pays 11 percent interest, compounded annually. Calculate how much money Jamal will have in his IRA at the end of 10 years, assuming that the interest rate remains the same and that he does not deposit any additional money. Use Exhibit 1-A. (Round time value factor to 3 decimal places and final answer to 2 decimal places.) Exhibit 1A Future value (compounded sum) of $1 after a given number of time periods Janine is 25 and has a good job at a biotechnology company. She currently has $7,000 in an IRA, an important part of her retirement nest egg. She believes her IRA will grow at an annual rate of 6 percent, and she plans to leave it untouched until she retires at age 65 . Janine estimates that she will need $946,000 in her total retirement nest egg by the time she is 65 in order to have retirement income of $24,500 a year (she expects that Social Security will pay her an additional $16,000 a year). How much will Janine's IRA be worth when she needs to start withdrawing money from it when she retires? Use Exhibit 1-A. (Round time value factor to 3 decimal places and final answer to 2 decimal places.)
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