Question

A very careful new father wants to set money aside for his baby daughter’s wedding. If the wedding takes place in 26.00 years, he expects it will cost $73,300.00 . If the father can earn 9.00% on his investments, how much does he need to invest today to reach his goal?

Answer Format: Currency: Round to: 2 decimal places.

Answer 1

	Answer =
	Amount required for vedding =		$                73,300
	Rate of interest earned =		9%
	Time available in years =		26 Years
	CACLULATION OF THE PRESENT VALUE OF $ 1 @ 9% in 26 Years
	Years		PVF of $ 1 @ 9 %
	1		0.9174
	2		0.8417
	3		0.7722
	4		0.7084
	5		0.6499
	6		0.5963
	7		0.5470
	8		0.5019
	9		0.4604
	10		0.4224
	11		0.3875
	12		0.3555
	13		0.3262
	14		0.2992
	15		0.2745
	16		0.2519
	17		0.2311
	18		0.2120
	19		0.1945
	20		0.1784
	21		0.1637
	22		0.1502
	23		0.1378
	24		0.1264
	25		0.1160
	26		0.1064
	So $ 1 have value today is = $ 0.1064 (Not rounuded)
	so, Value of $ 73,300 on today = $ 73,300 X $ 1.064 (not rounded)
	Present Value =	$        73,300.00	"X"	0.1064
	Present Value =	$           7,798.57
	Answer = New father will require today for achieve his goal is $ 7,798.57