Simulate Amanda's Portfolio Over the Next 30 Years and Determine

question 67

Essay

Simulate Amanda's portfolio over the next 30 years and determine how much she can expect to have in her account at the end of that period.At the beginning of each year,compute the beginning balance in Amanda's account.Note that this balance is either 0 (for year 1)or equal to the ending balance of the previous year.The contribution of $5,000 is then added to calculate the new balance.The market return for each year is given by a normal random variable with the parameters above (assume the market returns in each year are independent of the other years).The ending balance for the each year is then equal to the beginning balance,augmented by the contribution,and multiplied by (1+Market return).

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Definitions:

Purchase

The act of buying goods or services in exchange for money or other agreed-upon compensation.

Business Incubator

An organization that supports early-stage companies through mentorship, resources, and sometimes financial investment.

New Businesses

Enterprises that have been initiated recently, entering the market with new or innovative services or products.

Grow

To increase in size, amount, or intensity over time through natural development or active effort.