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)

3. Page 41
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5. H
6. Bh
7. 7
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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