Finance work
alberttttttt
FilebemetionedinSession2.pdf
Year T Earnings
Incremental
Savings if
work
K(T)=Saving
Account at
beginning of
T
K(T+1)=Saving
Account at end
of T if Work
TildeK(T+1)=Saving
Account at the end of
T if withdraw $5000
at beginning of T and
do not work
Does saving
account decrease if
stop working in T?
TildeK(T+1)<K(T) 1 10000 5000 0.0 5000.0
2 10000 5000 5000.0 10250.0 0.0 1 3 10000 5000 10250.0 15762.5 5512.5 1 4 10000 5000 15762.5 21550.6 11300.6 1 5 10000 5000 21550.6 27628.2 17378.2 1 6 10000 5000 27628.2 34009.6 23759.6 1 7 10000 5000 34009.6 40710.0 30460.0 1 8 10000 5000 40710.0 47745.5 37495.5 1 9 10000 5000 47745.5 55132.8 44882.8 1 10 10000 5000 55132.8 62889.5 52639.5 1 11 10000 5000 62889.5 71033.9 60783.9 1 12 10000 5000 71033.9 79585.6 69335.6 1 13 10000 5000 79585.6 88564.9 78314.9 1
14 10000 5000 88564.9 97993.2 87743.2 1
15 10000 5000 97993.2 107892.8 97642.8 1
16 10000 5000 107892.8 118287.5 108037.5 0
17 10000 5000 118287.5 129201.8 118951.8 0
18 10000 5000 129201.8 140661.9 130411.9 0
19 10000 5000 140661.9 152695.0 142445.0 0
20 10000 5000 152695.0 165329.8 155079.8 0
21 10000 5000 165329.8 178596.3 168346.3 0
r 0.05 s 0.6 T 10.87572
NPV of current and future consumption (5K(1+1/r)) 105000
14.7128
