Ian Would Like to Save $2,000,000 by the Time He

question 57

Multiple Choice

Ian would like to save $2,000,000 by the time he retires in 40 years. If he believes that he can achieve a 7% rate of return, how much does he need to deposit each year, starting one year from now, to achieve his goal?

• A)$12,065
• B)$37,500
• C)$5,790
• D)$10,018

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Definitions:

Reasonably Estimable

A term used in accounting to describe a cost or liability that can be accurately predicted or projected.

Contingent Liability

A potential financial obligation depending on the outcome of future events, not yet confirmed as a liability.

Future Event

A future event is an occurrence or situation that is expected or anticipated to happen at a later date, which can impact financial planning and decisions.

Current Liabilities

Obligations or debts that a company is expected to pay within one year or within its normal operating cycle, whichever is longer.