Questions 16-20 all refer to the following situation: Because an expert member of the State Board of Nursing-Home Regulation is paid as a consultant rather than as a regular employee, she is not a participant in the state's retirement plan. With 30 years to go until age 65, she feels she needs to build up a "nest egg" of $300,000 to support herself in retirement. She has worked out a deal with Globe Insurance Co. for an annual interest rate of 9.6% compounded monthly over the 30-year period until retirement and now needs to know how large a monthly deposit she will have to make in order to guarantee a nest egg of that size.

19. The size of the deposit required to build the desired "nest egg" is:

a. $120.22

Nope, try using this equation:
    
Where:

"R" signifies the size of the regular deposit.
    Which is what we are trying to find.

"F" signifies the future value of the fund.
     In this case, $300,000.

"i" signifies the interest rate per deposit period.
     In this case, 0.096/12 = 0.008.

"n" signifies the number of deposits to be made.
     In this case, 12 X 30 = 360.

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