Finance

Quiz: Problem Set 2

10/4/15, 10:50 PM



Problem Set 2

Started: Oct 4 at 10:50pm

Quiz Instructions

Please answer the following questions by filling in the blanks with your numerical answers.

You can find the individual problem set quiz questions here

(https://www.dropbox.com/s/jqxrctxewv3xmsd/Problem%20Set%202%20-%20Questions.pdf?dl=0)

. Review the questions before you begin the quiz; once you begin the quiz you cannot stop.

Do NOT include commas "," in your numerical answer, input your numerical answer

without commas. For example, if you answer is 111,111, input 111111. If you input a

comma, Canvas will substitute a decimal place.

Canvas will not let you input a dollar sign, $, so input you answer with simply the

numerical dollar amount. For example, if your answer is $555,444, input 555444.

Canvas will not accept a % sign, so input your answer using the appropriate decimal

places. For example, input 5.2% as .052.

Canvas will only accept up to four decimal places. The quiz takes into account rounding.

You do not need to include any decimal places.

You can take the quiz as many times as you wish:

Canvas will record your highest score.

You must complete the quiz by the beginning of the class on the due date. To be fair, I

cannot accept late assignments.

Problem 1: Retirement and Inflation

Today is your 35th birthday and it occurs to you that your current retirement

savings may be insufficient to maintain for you the lifestyle to which you have

become accustomed.

The value of your retirement account on your 35th birthday is $100,000.

You plan to retire on your 65th birthday and to live until the day before

your 83rd birthday.

Your goal is to have a stream of cash payments on your 66th through 82nd

birthdays that provides you with $150,000 of consumption annually in

https://canvas.northwestern.edu/courses/27909/quizzes/34149/take

Page 1 of 5

Quiz: Problem Set 2

10/4/15, 10:50 PM

terms of today’s purchasing...