SOLUTION: Please help!! Wilma wants to have $2m when she retires in 45 years. Assuming that she can average 4.5% return annually in Treasury Bills, then how much must she invest now in Tre

Question 212919: Please help!! Wilma wants to have $2m when she retires in 45 years. Assuming that she can average 4.5% return annually in Treasury Bills, then how much must she invest now in Treasury Bills to achieve her goal?
Answer by ankor@dixie-net.com(22740) (Show Source): You can put this solution on YOUR website!
Wilma wants to have $2m when she retires in 45 years. Assuming that she can average 4.5% return annually in Treasury Bills, then how much must she invest now in Treasury Bills to achieve her goal?
:
Use the formula: A = Ao*(1+i)^t
Where
A = resulting amt ( 2million)
Ao = initial amt
t = time (45 yrs)
i = annual interest rate in decimal form (.045)
:
Ao * (1.045)^45 = 2000000
:
Find 1.045^45 on a calc
Ao * 7.248248 = 200000
Ao =
Ao = $275,928.73 required

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