Asked by
Jeremiah Franklin
on Dec 20, 2024
Verified
Your lifetime financial goal is to have $1,250,000 invested in a mutual fund when you retire in 40 years. You plan to invest $1,000 in a mutual fund now, and then invest an additional $200 per quarter for 40 years. What average return must the fund provide to meet your investment goal?
A) 8.34%
B) 10.44%
C) 12.13%
D) 13.16%
Mutual Fund
An investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, and other assets.
Investment Goal
The financial objective or target that an investor aims to achieve through investments.
Average Return
The mean amount of profit or loss generated by an investment over a specified period.
- Identify the needed savings to reach intended financial goals in the future.
- Understand and differentiate between various compounding frequencies and their impacts on investments and loans.
Verified Answer
JG
Learning Objectives
- Identify the needed savings to reach intended financial goals in the future.
- Understand and differentiate between various compounding frequencies and their impacts on investments and loans.