You want to have $78,000 in 16 years to help your child attend college. If you...

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You want to have $78,000 in 16 years to help your child attend college. If you can esrn an annual interest rate of 3.4 percent, how much will you have to deposit today?

You want to have $78,000 in 16 years to help your child attend college. If you can earn an annual interest rate of 3.4 percen

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Answer 1

Answer #1

This question requires application of basic time value of money function, according to which FV = PV * (1 + r) where FV is F

$78000 = PV * (1 + 3.4%)¹⁶

$78000 = PV * 1.707378

PV = $45,684.20---> Answer

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Answer 2

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