Question
upstudy study bank question image url

Payments with periodic rates. Denise has her heart set on being a millionaire. What payment does
Denise need to make at the end of each month over the coming 40 years at APR to reach her
retirement goal of million?
What monthly payment does Denise need to make to reach her retirement goal?
(Round to the nearest cenir)

Ask by Stewart Riley. in the United States
Jan 24,2025

Upstudy AI Solution

Tutor-Verified Answer

Answer

Denise needs to make a monthly payment of $257.48 to reach her retirement goal of $1.2 million in 40 years at a 9% APR.

Solution

Sign in to Unlock Answers for Free!

A Learning Platform Trusted by Millions of Real Students and Teachers.

star-icon Unlock

Answered by UpStudy AI and reviewed by a Professional Tutor

Mind Expander

To calculate the monthly payment Denise needs to make in order to reach her retirement goal of $1.2 million in 40 years at a 9% annual interest rate, we can use the future value of an annuity formula. The formula is:
Where:
  • is the future value ($1,200,000)
  • is the monthly payment
  • is the monthly interest rate (annual rate / 12)
  • is the total number of payments (number of years × 12)
Using and , we rearrange the formula to solve for :
Substituting the values:
Calculating this yields:
  1. Calculate which is approximately 10.932.
  2. Then .
Therefore, Denise needs to make a monthly payment of approximately to achieve her retirement goal of million in 40 years.

Related Questions

Latest Economics Questions

\begin{tabular}{l|l}\multicolumn{1}{l}{ A variable that can't be accounted for is } & The author backs up the statement that the economy \\ can be unpredictable by pointing out that \\ a natural disaster such as a hurricane. As the & result of a hurricane, demand is guaranteed \\ to increase in a way that could not have been & (A) banking panics occur when confidence in the financial \\ system is strong. \\ predicted because the flow of goods into & (B) natural disasters can affect the demand for goods and \\ disrupt production. \\ impacted areas is blocked. If crops or power \\ facilities like oil refineries are damaged, then & C. customers are more willing to buy something when \\ interest rates are low. \\ demand is also affected. & (D) inflation occurs when prices for goods and services \\ decrease too quickly. \end{tabular}
Try Premium now!
Try Premium and ask Thoth AI unlimited math questions now!
Maybe later Go Premium
Study can be a real struggle
Why not UpStudy it?
Select your plan below
Premium

You can enjoy

Start now
  • Step-by-step explanations
  • 24/7 expert live tutors
  • Unlimited number of questions
  • No interruptions
  • Full access to Answer and Solution
  • Full Access to PDF Chat, UpStudy Chat, Browsing Chat
Basic

Totally free but limited

  • Limited Solution
Welcome to UpStudy!
Please sign in to continue the Thoth AI Chat journey
Continue with Email
Or continue with
By clicking “Sign in”, you agree to our Terms of Use & Privacy Policy