Already Graded 2019 BUSI352 quiz 5 complete solutions correct answers key Course 201920 Spring 2019 BUSI 352-B01 LUO Question 1 2 out of 2 points Why is inflation important to consider in retirement planning? Question 2 0 out of 2 points David, age 52, has come to you for help in planning his retirement. He works for a bank, where he earns $60,000. David would like to retire at age 62. He has consistently earned 8% on his investments and inflation has averaged 3%. Assuming he is expected to live until age 95 and he has a wage replacement ratio of 80%, how much more will David need at retirement to have the same amount at his death as he will have at his retirement? Question 3 0 out of 2 points Shannon is planning for her retirement. She is currently 35 years old and plans to retire at age 60 and live until age 95. Shannon currently earns $100,000 per year and anticipates needing 80% of her income during retirement. She anticipates Social Security will provide her with $15,000 per year leaving her with required savings to provide $65,000 ($100,000 x 0.80 – $15,000) annually during retirement. She believes she can earn 11% on her investments and inflation will be 2% per year. Assume Shannon would like to have the same purchasing power in retirement savings at age 95, as she does at age 60, when she retires. How much must Shannon save at the end of each year, if she wants to make her last savings payment at age 60 to meet her retirement goal, assuming she wants to maintain the original purchasing power of her capital balance? Question 4 2 out of 2 points Rick would like to retire in 11 years at the age of 66. He would like to have sufficient retirement assets to allow him to withdraw 90% of his current income, less Social Security, at the beginning of each year. He expects to receive $24,000 per year from Social Security in todays dollars. Rick is conservative and assumes that he will only earn 9% on his investments, that inflation will be 4% per year and that he will live to be 106 years old. If Rick currently earns $150,000, how much does he need at retirement? Question 5 2 out of 2 points Jane has the following expenditures during the current year. 1- Health Care $950 2- Travel $800 3- Savings $3,800 4- Gifts to Grandchildren $1,400 Which of these expenditures would you expect to decrease during Janes retirement? Question 6 2 out of 2 points Wilber, age 25, is hoping to retire at age 60. He expects to live until age 90. He anticipates needing $45,000 per year in todays dollars during retirement. Tyrone can earn a 12% rate of return and he expects inflation to be 4%. How much must Wilber save, at the beginning of each year, to meet his retirement goal? Question 7 2 out of 2 points David, age 52, has come to you for help in planning his retirement. He works for an insurance company, where he earns $60,000. David would like to retire at age 62. He has consistently earned 8% on his investments and inflation has averaged 3%. Assuming he is expected to live until age 95 and he has a wage replacement ratio of 80%, how much will David need to have accumulated as of the day he retires to adequately provide for his retirement lifestyle? Question 8 0 out of 2 points Phil and Sherry, both age 40, have $80,000 of combined retirement assets. They both expect to retire at the age of 65 with a life expectancy of 100 years old. They expect to earn 10% on the assets within their retirement accounts before retirement and 8% during their retirement. If they did not make any additional contributions to their account and they receive a fixed monthly annuity benefit for life, what is the monthly benefit (annuity due) amount they will receive during retirement? Question 9 0 out of 2 points David, age 52, has come to you for help in planning his retirement. He works for a bank, where he earns $60,000. David woul…
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