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You would like to purchase a car in 3 years and expect it will cost $35,000....

You would like to purchase a car in 3 years and expect it will cost $35,000. You have access to an investment account that earns 10%, compounded annually. How much must you put in the account today?

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Answer #1

Present value=$35000*Present value of discounting factor(rate%,time period)

=$35000/1.1^3

which is equal to

=$26,296.02(Approx).

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