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You would like to be a millionaire when you retire in 40 years, and hov...

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Finance

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You would like to be a millionaire when you retire in 40 years, and hov niychyouf must imvest today to reach that goal clearly depends on what rate of refarn you can earn, First, suppose you can earn 10.9% per year, and calculate how much you wayd have to irnvest today. Second, suppose you can only eam haif that percenthoe rate and calculate how much you would have to invest today. Divide the second by the furst, to see how mamy times more you must imvest today at half that annual rate grow it to $1 million over 40 years. (Do not round the numbers in intermediate calculations.) but enter your answer rounded to 2 decimal places (for exanple, 2.31)] For example, the PV of 51m in 40 years at 10% is PV=1.000,000/(1+.10)40=$22.095 The. PY of 51m in 40 years at half that rate or 5% is PV=1,000,000/(1+05)40=$142,046 which is 142.046/22.095=6.43 times the PV using 1006

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