Computing desired amonut of investment

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Reference no: EM1363600

Jane Alexander currently has $6,750 in a money market account paying 6.35 percent annually. She plans to use this amount and her savings over the next 8 years to make a down payment on a house. She estimates that she will need $20,000 in 8 years.

How much should she invest in the money market account each year for the next 8 years to achieve her objective?

How much would she need as a lump sum payment to compound to $20,000 in 8 years at 6.35% annual rate?

Reference no: EM1363600

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