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1. What savings rate from real income (Spreadsheet 21.3) will produce the same r

ID: 2624004 • Letter: 1

Question

1. What savings rate from real income (Spreadsheet 21.3) will produce the same retirement annuity as a 15% savings rate from nominal income?

2. Assume a traditional tax shelter Spreadsheet 21.6, calculate the effects of an increase of 1% in the lowest tax bracket to an increase of 1% in the highest tax bracket.

3. If an investor wants to invest 100% of her portfolio in safe assets but does not want to manage her portfolio, she should invest in __________.

4. The risk that a downturn in the market may substantially reduce your investment principal is called _______.

A. a money market fund B. a growth stock fund C. several different money market instruments D. several different stocks

Explanation / Answer

3. A.Money market fund

4.C.market risk