Assume That You Are 30 Years Old Today, and That

question 3

Multiple Choice

Assume that you are 30 years old today, and that you are planning on retirement at age 65. You expect your salary to be $42,000 one year from now and you also expect your salary to increase at a rate of 5% per year as long as you work. To save for your retirement, you plan on making annual contributions to a retirement account. Your first contribution will be made on your 31st birthday and will be 8% of this year's salary. Likewise, you expect to deposit 8% of your salary each year until you reach age 65. Assume that the rate of interest is 9%. The present value (PV) (at age 30) of your retirement savings is closest to ________.

• A) $61,303
• B) $30,652
• C) $42,912
• D) $67,433

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Definitions:

Basic Shapes

Fundamental geometric figures such as circles, squares, triangles, and rectangles, which are the building blocks for more complex designs.

Drawing

The practice of creating visuals on a surface such as paper through the application of marks, often made with ink, graphite, chalk, charcoal, or crayons.

Pictorial

Relating to or represented in the form of pictures or visual imagery.

Design Stage

A phase in project development or the creation of a product where plans, specifications, and blueprints are developed and finalized.