# suppose your investment returns are taxed at a 25% rate. if you invest $10,000 today and expect to earn a rate of return of 8%, what will your investment be worth in 15 years?

### James

Guys, does anyone know the answer?

get suppose your investment returns are taxed at a 25% rate. if you invest $10,000 today and expect to earn a rate of return of 8%, what will your investment be worth in 15 years? from EN Bilgi.

## Investment Returns Calculator

The purpose of the Investment Returns tool is to illustrate how things like inflation, taxes, the length of the investment, and the economic climate can impact the return of an investment.

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## Investment Returns Calculator

Predicting returns on investment is a difficult process. To get an accurate picture, it's not enough to merely assume a given rate of return; you need to take into account other factors like inflation and taxes to determine what your investment will be worth in real terms a number of years down the road. This Investment Returns Calculator allows you to do just that. In addition to figuring your rate of return over time, this calculator also lets you see how such factors as the economic climate, taxes and additional investments over time will affect your investment. You can also easily vary each of these to see how changes in one or several factors will affect your investments over time, and view results for simple vs. compounded interest.

By changing any value in the following form fields, calculated values are immediately provided for displayed output values. Click the view report button to see all of your results.

Investment totals $610,420 after 25 years.

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## Investment returns Inputs:

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1 34 67 100 0% 4% 8% 12% $0 $10k $100k $500k $0 $1k $5k $20k 0% 4% 8% 12% 0% 25% 50% 75%

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Check here to show all totals after inflation

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Line Graph: Please view the report to see detailed calculation results in tabular form.

## Annual Investment Returns

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## About Returns on Investment

Investing is a complicated process. You need to understand how the various investment products work, what their risk level is and what style of investing you are comfortable with. You also need to take into consideration taxes, inflation, fees and the health of the economy. If you aren't familiar with investing, or with factoring in elements that can impact the rate of return an investment will produce, then you should try our Investment Returns Tool.

## What can you do with this calculator?

The Investment Returns Calculator can serve a number of investment purposes. For example:

Predicting how your investments might perform over time

Gauging risk vs. reward in comparing two different investments with different rates of return

Retirement planning and working out what sort of nest egg you might have

Looking at how the rate of inflation might affect your investments

Assessing how investing additional amounts over time will affect your overall returns

Figuring the impact of different income tax rates on your investment performance

Calculating the effects of simple vs. compounding interest

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## Using the Investment Returns Calculator

To use this tool you will need to enter the number of years you plan to hold onto an investment product, the expected rate of return, your initial investment amount, your annual investment amount, the current inflation rate and your current tax rate for investments. After entering these amounts click on "calculate." This will produce a graph. If you want a detailed view of your investment scenario you will need to click on the "view report" button.

Here is additional information that may be useful when using the calculator:

Rate of return: This is the annually compounded rate of return for your investments. For the 10 years ending in December 2015, the S&P 500 annual rate of return was 7.76 percent, including the reinvestment of dividends. From 1970 through 2015, the average rate was 10.5 percent, ranging from a 12-month high of 61 percent (June 1982-83) and a low of -43 percent (March 2008-09). These figures should only be used in generating estimates; future performance cannot be reliably predicted from past trends.

Annual investment: The additional amount you plan to invest each year, on top of your original investment.

Expected inflation rate: Enter the average rate of inflation you expect to occur during your investment. From 1925 through 2015, the average rate of inflation was 2.9 percent, based on the Consumer Price Index.

Tax rate: Enter your total tax rate based on income, federal, state, local, etc.

As you enter your information, the calculator will automatically determine the total value of your investment at the end of the time specified and display it in the blue bar at the top. Changing any of those values, such as by moving the green triangles, will immediately change your investment totals as well.

## Return on Investment Calculator

Bankrate.com provides a FREE return on investment calculator and other ROI calculators to compare the impact of taxes on your investments.

## Return On Investment Calculator

Return On Investment Calculator Calculate your earnings and more

Meeting your long-term investment goal is dependent on a number of factors. This not only includes your investment capital and rate of return, but inflation, taxes and your time horizon. This calculator helps you sort through these factors and determine your bottom line. Click the "View Report" button for a detailed look at the results.

Investment totals $3,342,052 after 25 years.

Investment returns Inputs:

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[-] 1 34 67 100 0% 4% 8% 12% $0 $10k $100k $500k $0 $1k $5k $20k 0% 4% 8% 12% 0% 25% 50% 75%

Inflation adjustment:

Show values after inflation:

Please view the report to see detailed results in tabular form.

Annual Investment Returns

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### Definitions

YEARS

The number of years you wish to analyze. This can be any number from one to one hundred.

RATE OF RETURN

This is the annually compounded rate of return you expect from your investments before taxes. The actual rate of return is largely dependent on the types of investments you select. The Standard & Poor's 500® (S&P 500®) for the 10 years ending December 31st 2016, had an annual compounded rate of return of 6.6%, including reinvestment of dividends. From January 1, 1970 to December 31st 2016, the average annual compounded rate of return for the S&P 500®, including reinvestment of dividends, was approximately 10.3% (source: www.standardandpoors.com). Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a financial institution may pay as little as 0.25% or less but carry significantly lower risk of loss of principal balances.

It is important to remember that these scenarios are hypothetical and that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that Separate Account investment funds and/or investment companies may charge.

INITIAL INVESTMENT

Total you currently have invested that should be included in this analysis.

ADDITIONAL INVESTMENTS

The amount you will contribute to your investments each period. If you check the box to adjust this amount for inflation, your annual investment will increase each year by the inflation rate.

FREQUENCY OF CONTRIBUTIONS

How often you make contributions to your account. The options include weekly, bi-weekly, monthly, quarterly and annually. This calculator assumes that you make your contributions at the beginning of each period.

INFLATION RATE

This is what you expect for the average long-term inflation rate. A common measure of inflation in the U.S. is the Consumer Price Index (CPI). From 1925 through 2016 the CPI has a long-term average of 2.9% annually. Over the last 40 years highest CPI recorded was 13.5% in 1980. For 2016, the last full year available, the CPI was 1.1% annually as reported by the Minneapolis Federal Reserve.

TAX RATE

The percentage of your investment return you will pay in taxes. Your taxes are assumed to be payable annually, at the end of the year.

INFLATION ADJUSTMENT

Check this box to increase your future investment amounts for inflation.

SHOW VALUES AFTER INFLATION

Check this box to show all totals after inflation. By choosing this option you will see the value of your investments in terms of purchasing power, if you had that amount available today.

COMPOUND INTEREST

Interest on an investment's interest, plus previous interest. The more frequently this occurs, the sooner your accumulated interest will generate additional interest. You should check with your financial institution to find out how often interest is being compounded on your particular investment.

COMPOUNDED INTEREST RETURN

Total after-tax return if your investment profit is compounded annually.

SIMPLE INTEREST RETURN

Total after-tax return if your investment profit is simple interest with no compounding.

TOTAL INVESTED CAPITAL

Total you have invested. This includes your initial investment and all periodic investments.

INVESTMENT FINAL TOTAL

Your investment's total ending value. If you have checked the box to show values after inflation, this amount is the total value of your investment in today's dollars. If this box is unchecked, it will show the actual value of the investment.

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## Quiz 3 Flashcards

Start studying Quiz 3. Learn vocabulary, terms, and more with flashcards, games, and other study tools.

## Quiz 3

Which of the following is a primary disadvantage to investing in a hedge fund?

A) Hedge funds invest in only stocks

B) Hedge funds use advanced investment strategies

C) Illiquidity

D) Hedge funds invest in only bonds

E) Lax regulation

Click card to see definition 👆

C

Click again to see term 👆

Which of the following is an advantage to investing in a hedge fund?

A) Hedge funds invest in only stocks

B) Low fees C) Illiquidity

D) Hedge funds almost always hedge

E) Hedge funds use advanced investment strategies and benefit from lax regulation

Click card to see definition 👆

E

Click again to see term 👆

1/42 Created by danielle_jacobss

### Terms in this set (42)

Which of the following is a primary disadvantage to investing in a hedge fund?

A) Hedge funds invest in only stocks

B) Hedge funds use advanced investment strategies

C) Illiquidity

D) Hedge funds invest in only bonds

E) Lax regulation C

Which of the following is an advantage to investing in a hedge fund?

A) Hedge funds invest in only stocks

B) Low fees C) Illiquidity

D) Hedge funds almost always hedge

E) Hedge funds use advanced investment strategies and benefit from lax regulation

E

Which of the following is true concerning the difference between simple and compound interest?

A) With compound interest, interest is earned only on the original investment whereas with simple interest, interest is earned on interest.

B) Simple interest always leads to a higher ending investment value when compared to compound interest.

C) With simple interest, interest is earned only on the original investment whereas with compound interest, interest is earned on both the original investment and the accumulated interest.

D) With compound interest, the assumption is that interest earned on the original investment is not reinvested. With simple interest, interest is reinvested.

E) Simple interest and compound interest always lead to the same ending investment value so there is no difference between the two methods.

C

If you are buying a stock, which of the following ask prices is the most attractive?

A) 10.75-10.90 B) 10.72-10.87 C) 10.71-10.86 D) 10.77-10.91 E) 10.70-10.83 E

If you are selling a stock, which of the following bid prices is the most attractive?

A) 40.60-41.05 B) 40.62-41.07 C) 40.61-41.06 D) 40.67-41.12 E) 40.64-41.01 D

Ms. Awesome needs $1,000,000 upon retirement in 10 years to live comfortably. She can invest $75,000 a year to her retirement. What interest rate would her investment need to earn in order for her to meet her goals?

A) 6.2% B) 2.7% C) 7.9% D) 16.9%

E) This plan is not feasible.

A

Mr. Wonderful needs $2,000,000 upon retirement in 10 years to live comfortably. He can invest $100,000 a year to his retirement. What interest rate would his investment need to earn in order for him to meet his goals?

A) 4.8% B) 13.7% C) 14.7% D) 23.7%

E) This plan is not feasible

C

Suppose your investment returns are taxed at a 25% rate. If you invest $10,000 today and expect to earn a rate of return of 6%, what will your investment be worth in 10 years?

A) $15,530 B) $14,802 C) $11,046 D) $10,400 E) $10,300 A

Suppose your investment returns are taxed at a 20% rate. If you invest $100,000 today and expect to earn a rate of return of 6%, what will your investment be worth in 20 years?

A) $320,713 B) $142,874 C) $106,000 D) $255,403 E) $104,200 D

What interest rate would you have to earn if you wanted to triple an investment in 10 years?

A) 10.0% B) 15.6% C) 20.0% D) 4.4% E) 11.6% E

According to the financial life cycle, which of the following is usually the first source of OUTSIDE capital that a business uses to finance its growth?

A) Venture capital B) Equity offerings C) Bond offerings D) Bank financing E) Private equity D

According to the financial life cycle, which of the following is the first source of capital for a business?

A) Bank financing B) Owner's capital C) Private Equity D) Bond offerings E) Venture capital B

What is the following is true about the S&P 500?

A) The largest sector in the S&P 500 is the financial sector

B) The S&P 500 is the best known stock market index

C) The S&P 500 weights stocks by their market price

D) The S&P 500 is composed of the 500 companies with the highest annual sales

E) The S&P 500 weights stocks by their market value

E

What is the following is true about the Dow Jones Industrial Average (DJIA)?

A) Apple is the biggest stock in the DJIA

B) The DJIA includes 500 stocks

C) The DJIA is a broad measure of the performance of U.S. stocks

D) The DJIA is a market-value weighted index

E) The DJIA weights stocks by their market price

E

Which of the following transactions would take place in the secondary securities market?

A) An investor buys a stock from another investor.

B) An investor buys an IPO stock through an investment bank.

Guys, does anyone know the answer?