An investor has an effective tax rate on all items of 33%, and he decides to put $9,000 into a 401k. The future value of the investment that results from the deferral of taxes over 30 years at an 8% return equals ________.

A) $2,400
B) $8,000
C) $10,400
D) $29,886

Question

Alexa Quartz · Accepted Answer

Final Answer : D, Explanation :  Extra savings = $9,000 × 0.33 = $2,970FV = ($2,970) × (1 + 0.08) 30  = $29,886Calculator entries are N = 30, I/Y = 8, PV = −2,970, PMT = 0, CPT FV → 29,886.09.

An investor has an effective tax rate on all items of 33%, and he decides to put $9,000 into a 401k. The future value of the investment that results from the deferral of taxes over 30 years at an 8% return equals ________.

A) $2,400
B) $8,000
C) $10,400
D) $29,886

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Learning Objectives

Related questions

An investor has an effective tax rate on all items of 33%, and he decides to put $9,000 into a 401k. The future value of the investment that results from the deferral of taxes over 30 years at an 8% return equals ________.A) $2,400B) $8,000C) $10,400D) $29,886

Definitions

Learning Objectives

Learning Objectives

Related questions

An investor has an effective tax rate on all items of 33%, and he decides to put $9,000 into a 401k. The future value of the investment that results from the deferral of taxes over 30 years at an 8% return equals ________.

A) $2,400
B) $8,000
C) $10,400
D) $29,886