Distinguish between defined-benefit and defined-contribution pension schemes. Why are defined-contribution pension schemes becoming more important? Content 1. Introduction 2. Differences between DB and DC 2.1 Evaluation of retirement payment 2.2 Risks for employers and employees 2.3 Incentives 3. The reasons for DC becoming prevalent and important 3.1 Financial perspective 3.2 Costs and risks 3.3 Industry composition and labour force demographics 4. Conclusion 5. References
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contributions of this thesis are i) an insightful overview of EPF ii) construction of scenarios for assets returns and liabilities with different values of growth dividend‚ that combine the Markov population model with the salary growth model and retirement payments iii) construction and
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Chapter 06 Discounted Cash Flow Valuation Multiple Choice Questions 1. An ordinary annuity is best defined by which one of the following? A. increasing payments paid for a definitive period of time B. increasing payments paid forever C. equal payments paid at regular intervals over a stated time period D. equal payments paid at regular intervals of time on an ongoing basis E. unequal payments that occur at set intervals for a limited period of time 2. Which one of the following
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week to your retirement plan. Assume that you work for your employer for another twenty years and that the applicable discount rate is 5%. Given these assumptions‚ what is this employee benefit worth to you today? 5. You retire at age 60 and expect to live another 27 years. On the day you retire‚ you have $464‚900 in your retirement savings account. You are conservative and expect to earn 4.5% on your money during your retirement. How much can you withdraw from your retirement savings each
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Introduction The time value of money is an important concept in financial management. It can be used to compare investment alternatives and to solve problems involving loans‚ mortgages‚ leases‚ savings‚ and annuities. The time value of money can be defined as the value of money received today instead of in the future. This is based on the premise that cash in hand today is more valuable than the same amount in the future due to its capability of earning interest. For investors‚ this is single most
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Correct. Total 5.00 / 5.00 Question Explanation Interest rate conversion. Question 2 (5 points) Gloria is 37 and trying to plan for retirement. She has put a budget together and plans to save $4‚100 per year‚ starting at the end of this year‚ in a retirement fund until she is 56. Assume that she can make 7.0% on her account. How much will she have for retirement at age 56? Your Answer Score Explanation $77‚900.00 $153‚253.76 Correct 5.00 Correct. $168‚081.52 $101‚394.22 Total 5.00 /
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Time Value of Money (TVM)‚ developed by Leonardo Fibonacci in 1202‚ is an important concept in financial management. It can be used to compare investment alternatives and to solve problems involving loans‚ mortgages‚ leases‚ savings‚ and annuities. TVM is based on the concept that a dollar today is worth more than a dollar in the future. That is mainly because money held today can be invested and earn interest. A key concept of TVM is that a single sum of money or a series of equal‚
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CHAPTER 4 PART II: VALUATION AND CAPITAL BUDGETING Discounted Cash Flow Valuation The signing of big-name athletes is often accompanied by great fanfare‚ but the numbers are often misleading. For example‚ in late 2010‚ catcher Victor Martinez reached a deal with the Detroit Tigers‚ signing a contract with a reported value of $50 million. Not bad‚ especially for someone who makes a living using the “tools of ignorance” (jock jargon for a catcher’s equipment). Another example is the contract signed
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------------------------------------------------- Top of Form Powered by ExamFX - Online Training & Assessment * Main Menu * My Account * Contact Us * Log Out Review Missed Questions Take some time to review the questions you missed in the session you just completed. This list shows all of the questions that you missed in the session you just completed. The answer you selected is in bold. The correct answer is highlighted in yellow. | | #1. | Which of the following
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Valuing Cash Flows – The Time Value of Money – Future Value – Present Value – Value Additivity • Project Evaluation – Net Present Value – The Net Present Value Rule • Shortcuts to Special Cash Flows – Perpetuities - Growing Perpetuities – Annuities - Growing Annuities • Compound Interest Rates – Compound Interest versus Simple Interest – Discrete Compounding – Continuous Compounding – Effective Annual Yield • Adjusting for Inflation Principles of Finance Present Value - Page 3 Valuing Cash Flows
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