Use the Following Information for Questions

question 10

Multiple Choice

Use the following information for questions
Mary needs $145,000 in 15 years to buy her son a new Ferrari. Assume that she can earn an 8% after-tax return on her investment. You may ignore inflation in these calculations.
-How much ignore cents) will Mary need to invest today?

• A) $5,340
• B) $459,965
• C) $45,710
• D) $47,401
• E) None of the above. No one should own a Ferrari.

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Definitions:

Trust's Income

The income generated from the assets held within a trust, which may include interests, dividends, and other earnings.

Lease Cancellation

The process by which a lease agreement is terminated before its specified end date, either by mutual agreement or due to breach of contract.

Demonstrative Legacy

A demonstrative legacy is a specific gift of money with the direction that it is to be paid out of a particular fund or property, used in wills and estate planning.

Probate

The legal process through which a deceased person's will is validated and their estate is distributed to beneficiaries.