1 of 11 (0 complete) Hw Score: 0%, 0 of 11 pts re: 0 of 1 pt Question Help * obl
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1 of 11 (0 complete) Hw Score: 0%, 0 of 11 pts re: 0 of 1 pt Question Help * oblem 4.L01.18 (similar to) ou want to compare two separate retirement savings scenarios: (A) and (B). In scenanio (A) you start immediately, contribute for a few years, but then stop ontributing, However, you leave the accumulated savings to compound untl retirement. In scenario (8) you start later (after the end of savings in scenario A) and ontribute all the way to retirement. Calculate the accumulated amount of savings at retirement for the two scenarios. Total Number of Payments Longth of Interest Scenario Annual Payment Period Payment $5,000 $5,000 Investment 32 years 32 years Rate 14% 14% (A) End of years 1 to 12 12 (B) End of years 13 to 32 20 Accumulated Amount of Savings at Retirement Scenario (Future Value) (Round to the nearest cent.)Explanation / Answer
Scenario A:
PMT = 5000, PV = 0, N = 12, rate = 14%
use FV function in Excel
value at the end of 12 years = 136,353.74
value at the end of 32 years = 136,353.74 * 1.1420 = 1,873,976.29
Scenario B
PMT = 5000, PV = 0, N = 20, rate = 14%
use FV function in Excel
value at the end of 32 years = 455,124.64
2.
PMT = 200, PV = 0, rate = 8%/12, FV = -35000
use nper function in Excel
number of months = 116.3647
number of years = 9.70 years
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