1. Suppose that you are just about to retire, and you just turned 65. Your personal...

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1. Suppose that you are just about to retire,and you just turned 65. Your personal and family health history issuch that you forecast that you will live to age 88.
In retirement, you would like to have purchasing power of$60,000 (i.e., real dollars) before taxes. Suppose, for ourexample, that you anticipate receiving $20,000 ininflation-adjusted Social Security payments each year. Hence, yourportfolio will need to provide $40,000 in real dollars each year.Assume that each payment is at the start of each yearin retirement, where the first payment isimmediately. How much do you need to have in your retirementaccount at retirement (in real dollars)? Assume that your portfolioearns a real annual rate of return of 5.06%, compounded annuallyduring retirement.
Do not round at intermediate steps in your calculation. Roundyour answer to the nearest dollar. Do not type the $ symbol.
2. Suppose that you are considering aconventional, fixed-rate 30-year mortgage loan for $100,000. Thelender quotes an APR of 5.56%, compounded monthly; mortgagepayments would be monthly, beginning one month after the closing onyour home purchase.
After 10 years of payments, what is the balance outstanding onyour loan?
Do not round at intermediate steps in your calculation. Roundyour answer to the nearest penny. Do not type the $ symbol.

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1. Suppose that you are just about to retire,and you just turned 65. Your personal and family health history issuch that you forecast that you will live to age 88.In retirement, you would like to have purchasing power of$60,000 (i.e., real dollars) before taxes. Suppose, for ourexample, that you anticipate receiving $20,000 ininflation-adjusted Social Security payments each year. Hence, yourportfolio will need to provide $40,000 in real dollars each year.Assume that each payment is at the start of each yearin retirement, where the first payment isimmediately. How much do you need to have in your retirementaccount at retirement (in real dollars)? Assume that your portfolioearns a real annual rate of return of 5.06%, compounded annuallyduring retirement.Do not round at intermediate steps in your calculation. Roundyour answer to the nearest dollar. Do not type the $ symbol.2. Suppose that you are considering aconventional, fixed-rate 30-year mortgage loan for $100,000. Thelender quotes an APR of 5.56%, compounded monthly; mortgagepayments would be monthly, beginning one month after the closing onyour home purchase.After 10 years of payments, what is the balance outstanding onyour loan?Do not round at intermediate steps in your calculation. Roundyour answer to the nearest penny. Do not type the $ symbol.