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Question
An employee who has worked for his firm for 30 years can retire right now and receive a constant annual benefit of $45,000. He has a final pay plan that pays his average salary over his final 5 years times 2% times years of service. He has decided he will keep working five more years but only if by doing so his retirement benefits will grow at 6% per year. How much would his expected average salary (to the nearest dollar) have to be over the next 5 years to keep him working?
A. $54,198
B. $86,029
C. $51,617
D. $66,911
E. $53,147
Answer
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