Base number and interest

timer Asked: May 13th, 2013

Question description

1)  if you purchase an item for $100 with a10% discount and then pay a 10% tax it does not
equal a $100. Why do you ask? What is the base number that was used.

Ex: $100 minus 10% discount is $10 = $100-$10 or $90 but the tax is calculated off a base of 90 so 10% or $9. So final purchase is $90 + $9 or $99. 

2)  If you were 35 years old and you hope to retire at age 55 years old, which means you’ll
retire in 20 years, therefore assume you are about to set up a new retirement
savings account at a 4% annual interest rate (APR). Based on how you want to
live in retirement, and any other sources of retirement income you have
available, how much money do you think you will need to draw from your savings
account each year?

Write a contribution plan with a break down that you can follow in order
to finance your new retirement account to reach this savings goal

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