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please conplete the document using cell references follwing the requirements (instructions) below. (labeled in 2nd picture.)

Assignment Instructions X Step Instructions Point Value 1 1 Complete the steps below using cell references to given data or previous calculations. In some cases, a simple cell reference is all you need. To copy/paste a formula across a row or down a column, an absolute cell reference or a mixed cell reference may be preferred. If a specific Excel function is to be used, the directions will specify the use of that function. Do not type in numerical data into a cell or function. Instead, make a reference to the cell in which the data is found. Make your computations only in the blue cells highlighted below. In all cases, unless otherwise directed, use the earliest appearance of the data in your formulas, usually the Given Data section. Start Excel. Download and open the workbook named: Berk_DeMarzo_Harford_Problem_4-25_Start. In cell D17, by using cell references, calculate the future Close In cell D17, by using cell references, calculate the future value of the yearly savings on the day you retire. Note: The output of the expression or function you typed in this cell is expected as a positive number. 2 1 In cell D21, by using cell references, calculate the lump-sum that you need to invest today in order to save the same amount as with the yearly savings. Note: The output of the expression or function you typed in this cell is expected as a positive number. 3 1 In cell D27, by using cell references, calculate the amount that you can withdraw from your retirement account every year. 4 1 In cell D33, by using cell references, calculate the number of years that it will take to deplete your retirement savings if you withdraw a certain amount per year. Close 3 1 In cell D27, by using cell references, calculate the amount that you can withdraw from your retirement account every year. 4. 1 In cell D33, by using cell references, calculate the number of years that it will take to deplete your retirement savings if you withdraw a certain amount per year. 5 1 In cell D40, by using cell references, calculate the return that you need to earn on your yearly savings for a certain payment to reach your goal at retirement. Note: For this particular case, only use the first four parameters of the RATE function. Assume Annual savings as a cash outflow and the Future value as an cash inflow. 6 0 Save the workbook. Close the workbook and then exit Excel. Submit the workbook as directed. Close Problem 4-25 You are trying to decide how much to save for retirement. Assume you plan to save $5,000 per year with the first investment made one year from now. You think you can cam 10% per year on your investments and you plan to retire in 43 years, immediately after making your last S5,000 investment. Complete the steps below using cell references to givert data or previous calculations. In some cases, a simple cell reference is all you need. To copy/paste a formula across a row or down a column, an absolute cell reference or a mixed cell reference may be preferred. If a specific Excel function is to be used, the directions will specify the use of that function. Do not type in numerical data into a cell or function. Instead, make a reference to the cell in which the data is found. Make your computations only in the blue cells highlighted below. In all cases, unless otherwise directed, use the earliest appearance of the data in your formulas, usually the Given Data section a 1. How much will you have in your retirement account on the day you retire? b. If, instead of investing $5,000 per year, you wanted to make one lump-sum investment today for your retirement that will result in the same retirement saving, how much would that lump sum need to be? c. e If you hope to live for 20 years in retirement, how much can you withdraw every year in retirement (starting one year after retirement) so that you will just exhaust your savings with the 20th withdrawal (assume your savings will continue to cum 10% in retirement? d. If instead, you decide to withdraw 5300,000 per year in retirement (again with the first withdrawal one year after retiring), how many years will it take until you exhaust your savings? Assuming the most you can afford to save is $1,000 per year, but you want to retire with $1 million in your investment account, how high of a retum do you need to cum on your investments? Annual saving 5,000 Interest rate 10% Years to retirement 43 1. How much will you have in your retirement account on the day you retire? Future value 9 10 11 12 13 14 15 16 12 18 S b. If, instead of investing $5,000 per year, you wanted to make one lump-sum investment today for your retirement that will result in the same retirement saving, how much would that lump sum need to be? 19 20 21 Lump-sum investment 4-25 + G c. 23 24 25 26 27 28 If you hope to live for 20 years in retirement, how much can you withdraw every year in retirement (starting one year after retirement) so that you will just exhaust your savings with the 20th withdrawal (assume your savings will continue to cam 10% in retirement)? Years of withdrawal 20 Annual withdrawal d. If, instead, you decide to withdraw $300,000 per year in retirement (again with the first withdrawal one year after retiring), how many years will it take until you exhaust your savings? 29 30 31 300,000 32 Annual withdrawal Number of periods 33 34 e. Assuming the most you can afford to save is $1,000 per year, but you want to retire with $1 million in your investment account, how high of a retum do you need to cam on your investments? 35 36 $ Annual saving Future value 1,000 1,000,000 $ 37 38 39 40 41 Rate of return 42 44 45 43 Requirements In cell D17, by using cell references, calculate the future value of the yearly savings on the day you retire (1 pt.). Note: The output of the expression or function you typed in this cell is expected as a positive number. 2 In cell D21, by using cell references, calculate the lump-sum that you need to invest today in order to save the same amount as with the yearly savings (1 pt). Note: The output of the expression or function you typed in this cell is expected as a positive number. In cell D27, by using cell references, calculate the amount that you can withdraw from your retirement account every year (1 pt). In cell D33, by using cell references, calculate the number of years that it will take to deplete your retirement savings if you withdraw a certain amount per year (1 pt). 5 In cell D40, by using cell references, calculate the retum that you need to cart on your yearly savings for a certain payment to reach your goal at retirement. Note: For this particular case, only use the first four parameters of the RATE function. Assume Annual savings as a cash outflow and the Future value as an cash inflow. (1 pt). 3 46 4 1 47 48 L44 Ax fx A 1 2 Problem 4-25 You are trying to decide how much to save for retirement. Assume you plan to save $5,000 per year with the first investment made one year from now. You think you can cam 10% per year on your investments and you plan to retire in 43 years, immediately after making your last $5,000 investment Complete the steps below using cell references to given data or previous calculations. In some cases, a simple cell reference is all you need. To copy/paste a formula across a row or down a column, an absolute cell reference or a mixed cel reference may be preferred. If a specific Excel function is to be used, the directions will specify the use of that function. Do not type in numerical data into a cell or function. Instead, make a reference to the cell in which the data is found. Make your computations only in the blue cells highlighted below. In all cases, unless otherwise directed, use the earliest appearance of the data in pour formulas, usually the Given Data section. a. How much will you have in your retirement account on the day you retire? b. If, instead of investing $5,000 per year, you wanted to make one lump-sum investment today for your retirement that will result in the same retirement saving, how much would that lump sum need to be? c. If you hope to live for 20 years in retirement, how much can you withdraw every year in retirement (starting one year after retirement) so that you will just exhaust your savings with the 20th withdrawal (assume your savings will continue to cam 10% in retirement)? d. If, instead, you decide to withdraw $300,000 per year in retirement (again the first withdrawal one year after retiring), how many years will it take until you exhaust your savings? in with e. Assuming the most you can afford to save is $1,000 per year, but you want to retire with S1 million in your investment account, how high of a retum do you need to eam on your investments? 9 10 11 S 12 13 Annual saving 5,000 Interest rate 10% Years to retirement 1. How much will you have in your retirement account on the day you retire? 43 14 15 16 27 18 Future value b. If, instead of investing $5,000 per year, you wanted to make one lump-sum investment today for your retirement that will result in the same retirement saving, how much would that lump sum need to be? 19 20 21 22 Lump-sum investment 4-25 + G 23 If you hope to live for 20 years in retirement, how much can you withdraw every year in retirement (starting one year after retirement) so that you will just exhaust your savings with the 20th withdrawal (assume your savings will continue to earn 10% in retirement)? Years of withdrawal 20 24 25 26 Annual withdrawal 27 28 d. If, instead, you decide to withdraw $300,000 per year in retirement (again with the first withdrawal one year after retiring), how many years will it take until you exhaust your savings? 29 30 31 32 33 34 Annual withdrawal 300,000 Number of periods 35 Assuming the most you can afford to save is $1,000 per year, but you want to retire with S1 million in your investment account, how high of a retur do you need to cam on your investments? Annual saving Future value 1,000,000 36 37 38 39 1,000 s s 40 Rate of retum 41 42 44 45 43 Requirements In cell D17, by using cell references, calculate the future value of the yearly savings on the day you retire (1 pt.). Note: The output of the expression or function you typed in this cell is expected as a positive number 2 In cell D21, by using cell references, calculate the lump-sum that you need to invest today in order to save the same amount as with the yearly savings (1 pt.). Note: The output of the expression or function you typed in this cell is expected as a positive number. In cell D27, by using cell references, calculate the amount that you can withdraw from your retirement account every year (1 pt) In cell D33, by using cell references, calculate the number of years that it will take to deplete your retirement savings if you withdraw a certain amount per year (1 pt) In cell D40, by using cell references, calculate the retum that you need to cam on your yearly savings for a certain payment to reach your goal at retirement. Note: For this particular case, only use the first four parameters of the RATE function. Assume Annual savings as a cash outflow and the Future value as an cash inflow. (I pt.) 3 46 4 47 5 48

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