After Saving Diligently Your Entire Career, You and Your Spouse

question 59

Multiple Choice

After saving diligently your entire career, you and your spouse are ready to retire with a nest egg of $600,000. You need to invest this money in a mix of stocks and bonds that will allow you to earn $5,000 per month for 30 years. What annual interest rate (APR) do you need to earn?

• A) 9.40 percent
• B) 10.13 percent
• C) 8.37 percent
• D) 9.61 percent

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Definitions:

Subsidence

The gradual sinking of the ground's surface, which can occur due to natural processes like the compacting of sediment or human activities such as groundwater extraction.

Gradient

A measure of how one quantity changes or varies over distance or another quantity, often expressed as a slope or rate of incline.

Permeability

An indicator of the ease with which fluids can flow through a material with pores or a rock.

Natural Cement

A type of material formed when certain natural rocks with hydraulic properties are finely ground and then mixed with water, initiating chemical reactions that result in a hardened substance.