You Are Planning to Save for Retirement Over the Next

question 10

Multiple Choice

You are planning to save for retirement over the next 15 years.To do this,you will invest $1,100 a month in a stock account and $500 a month in a bond account.The return on the stock account is expected to be 7 percent,and the bond account will pay 4 percent.When you retire,you will combine your money into an account with a 5 percent return.How much can you withdraw each month during retirement assuming a 20-year withdrawal period?

• A)$2,636.19
• B)$2,904.11
• C)$3,008.21
• D)$3,113.04
• E)$3,406.97

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Definitions:

Merit Pay Plans

Compensation strategies that reward employees based on their performance and achievements in the workplace.

Base Pay

The initial rate of compensation an employee receives, not including overtime, bonuses, or other additional compensation.

Performance Declines

A noticeable decrease in the effectiveness, productivity, or quality of work produced by an individual, team, or organization.

Labor Costs

The total amount of financial compensation, benefits, and overheads paid to employees in exchange for their labor.