sm10

sm10TimeValueofMoney.xlsx

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Sheet2

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,227.68

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$242,424.32

Question

1 value of CD

2 Value of reinvested CD

Value of Annuities due,

Value of investment account now

3 Value of IRA now

4 Amount accumulated at early retirement

5 PV at age 45

PV at age 55

FV of anuity due at age 55

Total value of investment at age 55

Amount to withdraw each January 1 upon early retirement

Question

Answers

value of CD

$10,068.00

Value of reinvested CD

$

4

5

Value of Annuities due,

$82,84

3

Value of investment account now

$128,070.98

Value of IRA now

$114,353.34

Amount accumulated at early retirement

$242,424.32

PV at age 45

PV at age 55

$523,375.92

FV of anuity due at age 55

$23,468.23

Total value of investment at age 55

$546,844.15

Amount to withdraw each January 1 upon early retirement

$75,459.17

Explanation of working

Formula

FV(7.25%,10,,-5000)

FV(6.75%,45-22,,-C2)

FV(6.75%,45-22,-1500,,1)

C4+C5

FV(7%,45-22,-2000,,1)

C6+C8

C10

FV(8%,55-45,,-C10)

FV(8%,55-45,-1500,,1)

C13+C14

PMT(8%,65-55,-C15,,1)

Sheet3