Your friend is celebrating her 24th birthday today and wants to start saving for her anticipated retirement at age 63. 1. She estimates that the annual spending needs would be $290,000 based on the current price level, and the inflation rate is expected to be 3% per year. 2. She wants to be able to make withdrawals for spending needs each year for 28 years following her retirement; the first withdrawal will be on her 64th birthday. 3. She expects to receive $6,500,000 inheritance on her 74th birthday. 4. She intends to invest her money in a conservative fund, which offers 6.7 percent interest per year after retirement. 5. Before retirement, your friend invests in stock funds, which offer (7 + 0.3 x Y) % interest per year. 6. She decides to buy a $6,000,000 apartment. Her parents will pay 40% down payment for her home. She will pay an annual mortgage for 25 years at 3% mortgage rate, starting from her 34th birthday. 7. She will get a $390,000 annual salary in her 25th birthday, and the salary is expected to increase by 8%. The last salary will be paid on her 63rd birthday. 8. If she starts making these deposits on her 25th birthday. What proportion of salary should she save each year?

a. Expected annual consumption needs on 64th birthday.

b. Present value of all retirement consumption needs (value at her 24th birthday).

c. Present value of the inheritance (value at her 24th birthday).

d. Present value of all mortgage payments (value at her 24th birthday).

e. Annual savings need as a percentage of her salary.

f. What is her balance on her 70th birthday (after paying the retirement needs on that date)?