“Present Value Formula

Sep 9th, 2015
Price: $5 USD

Question description

My best friend and her new husband (Fred and Ethel) just got back from their honeymoon which was a trip down the River Nile in Egypt. They are excited about traveling together as a couple and they want to start saving for a very special trip. My own 25th wedding anniversary falls in the same month as Fred and Ethel’s 12th anniversary and they thought it would be fun to plan a trip together. They have done a little research enough to realize we will need about $8,000 per couple set aside for this trip. Fred also found an investment opportunity which promises to have an average return of about 9% per year if one invests long term. We need to know how much each couple needs to invest now to reach their goal in time.

Tutor Answer

(Top Tutor) JennaB
School: Carnegie Mellon University

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