Ron is 25 years old and is retiring at the age of 65. when he retires, he will need a monthly income of $4,123 for 20 years. if ron contributes 10% of his monthly income to a 401(k) paying 5.5% compounded monthly, will he reach his goal for retirement given that his monthly income is 3,142.23? if he does not make his goal then state by what amount he will need to supplement his income. round all answers to the nearest cent. a.ron will meet his monthly goal of exactly $4,123 for retirement. b.ron will meet his monthly goal of $4,123 for retirement with an excess of $125.34.c. ron will not make his monthly goal of $4,123 and will need $359.74 to supplement his monthly income when he retires. d.ron will not make his monthly goal of $4,123 and will need $450.61 to supplement his monthly income when he retires.

C - Ron will not make his monthly goal of $4,123 and will need $359.74 to supplement his monthly income when he retires

Explanation:

Step by step explanation can be viewed below:

c.Ron will not make his monthly goal of $4,123 and will need $359.74 to supplement his monthly income when he retires.

Explanation:

Step-by-step explanation:

Ron monthly income is $3,142.23

Ron contributes 10% of $ 3142.23  wich is $314.223

if Ron is 25 years a now he needs 40 years to make his contribution towards retirement

Total amount he contribute in 40 years paying 5.5% compounded monthly is given by

interest rate(r) =\frac{0.055}{12}

time period = 40 years = 480 months

Principal amount = $ 314.223

Future value = P(\frac{(1+r)^n-1}{r} )

input the values

future value is $547074.681009.

After retirement his monthly income when he has $547074.681009 amount.

P=\dfrac{A\cdot\frac{i}{12} }{1-(1+\frac{i}{12})^{-n}}

monthly value after retirement

Putting values , we get,

P = $3763.25

He will get a monthly income of $3763.25.

Recall that his goal was to get 4123 per month , therefore

  (4123-3763.25)= $359.74 ,

means he will need $359.74 , extra

answerthe above statement is false;