# Case Study Cory And Tisha

Topics: Investment, Mutual fund, Index fund Pages: 2 (274 words) Published: December 9, 2014
﻿Case study: Cory and Tisha Dumont.
1. Dumonts are in the stage of accumulating wealth. In this 1st stage, they mostly need to set their 3 levels of financial goals plan a debt, and make expectation of their future tax payment. 2. Short term Goals (less than 1 year)

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8. FV of Ordinary annuity =\$40`000, i=9%, n=14, FV Interest factor= 26.019, PMT(Annual Payment) =? Calculation: FV=PMT*FV interest factor factor

If FV=\$100`000
9. FV of Annuity Due =\$40`000, i=9%, n=17 (16+1 because of annuity due) , FV Interest factor= 36,973, PMT =?
If FV (annuity due)=\$110`000, PMT=?
If FV of Ordinary annuity=\$110`000, i=9%, n=16, FV interest factor=33,003; PMT=?

10. PV=\$2300, i=7%, n=14 (when Chad enters college), FV factor= 2,579, How much will Tisha`s Great Basin Balanced Mutual Fund shared be worth, FV=? FV=PV*FV factor. FV=\$2300*2,579= \$5931,7
PV=\$2300, i=7%, n=16 (when Haley turns to 18), FV factor= 2,952; FV=? FV=\$2300*2,952=\$6789,6
PV=\$2300, i=9%, n=37 (when Tisha retires at 67), FV factor= 24,253, FV=? FV=\$2300*24,253=\$55783,82
FV=\$2300; PV=\$1000; n=10 (31-21); rate of return i=?
\$2300=\$1000*(1+i)10
(1+i)10=2,3; using FV of single sum table, ate the intersection of n=10 row and FV factor≈2,3; we find a rate of return i=9% 11. How much will Dumonds` market index fund (PV=\$13000) be worth (FV=?): At the rate of return i=6%

N=3; FV interest factor=1,191; FV=\$13000*1.191=\$15483
N=5; FV interest factor=1,338; FV=\$13000*1,338=\$17394
N=7; FV interest factor=1,504; FV=\$13000*1.504=\$19552
At the rate of return i=8%
N=3; FV interest factor=1,260; FV=\$13000*1.260=\$16380
N=5; FV interest factor=1,469; FV=\$13000*1.469=\$19097
N=7; FV interest factor=1,714; FV=\$13000*1.714=\$22282
12. PV=\$13000
13. Cory`s 401(k) retirement account PV=\$2500; growth rate i=5%; how much will Cory have when he retires at 67? N=36; FV interest factor=5,7918...

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