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Homework answers / question archive / You have the following assets: $25,000 in US stocks and $20,000 in International Stocks
You have the following assets: $25,000 in US stocks and $20,000 in International Stocks. You plan on retiring in 30 years. How much will each one of your assets be worth, if the average rate of return for US stocks was 7% and the average rate of return for International Stocks is 3%?
For US stocks-
Since, they have not mentioned any compunding, we consider simple interest-
SI- PNR/100
SI= 25000*7*30/100
SI= 52500
The US stocks will be worth A= 25000+52500= $77500
For International Stocks-
SI- PNR/100
Si= 20000*3*30/100
SI= 18000
The international stocks will be worth A= 20000+18000= 38000
