Excel Assignment:This assignment focuses on Time Value of Money concepts. There are a couple of...

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Excel Assignment:This assignment focuses on Time Value of Money concepts. There are a couple of things to keep in mind as you work on the problems of this assignment. First - disregard any "Penalties" associated with early withdrawal of funds from the IRA. In "real life", our investor would be required to pay for early withdrawal of funds from the IRA. Until you turn 59 1/2, if you withdraw from an IRA, you would likely need to pay a 10% early withdrawal penalty unless you can prove hardship. Second - when this problem was created, the retirement age was different than today to secure full social security benefits. We used 65 in the problem but the new retirement age is now slightly higher than 67 to receive full benefits from Social Security. In the real world, our investor might want to defer her retirement to maximize her social security retirement benefits but for the purposes of the problem, just use 65 as the retirement age. Just some things to be aware of!! By the time all of us can retire, the age to collect max benefits will probably be well in excess of 70!!See the attachment

Sumit · Accepted Answer

Sheet1
	1
	Amount (A)	$   5,000
	Period (P)	10	Years
	Interest Rate (I)	7.25%	P.A.
	Maturity Amount (M)	$   10,068		The formula for calculating the Value of CD at the end of period is A*(1+I)^P
	2
	Starting Amount (A)	$   10,068
	Annual Deposit (PMT)	$   1,500
	Period (P)	23	Years	Current Age is 45, Age at which Investment was made was 22, hence the period is 23 years
	Interest Rate (I)	6.75%	P.A.
	Maturity Amount (M)	$   122,832.64		The formula for calculating the Value of Annuity is PMT*(((1+I)^P - 1) / I)
	3
	Annual Deposit (PMT)	$   2,

Excel Assignment: This assignment focuses on Time Value of Money concepts. There are a couple of things to keep in mind as you work on the problems of this assignment. First - disregard any...

Excel Assignment:

See the attachment

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