Jamie wants to set aside enough money now to go on vacation in two years. She has developed the following

Jamie wants to set aside enough money now to go on vacation in two years. She has developed the following estimates: Estimated Cash Outflows Probability Assessment $2,700 30% $3,300 50% $4,500 20% Time periods Factor PV of 1 2 .90703 PV Annuity of 1 2 1.85941 FV of 1 2 1.10250 FV Ordinary annuity 2 2.05 How much should she deposit today in an account earning 5%, compounded annually, to have sufficient cash on hand to pay for the vacation


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