How much will she have to invest today

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Reference no: EM131916086

1.Tracy Chapman is saving to buy a house in five years. She plans to put 20 percent down at that time, and she believes that she will need $27,000 for the down payment. If Tracy can invest in a fund that pays 6.60 percent annually, how much will she have to invest today?

(If you solve this problem with algebra round intermediate calculations to 6 decimal places, in all cases round your final answer to the nearest penny.)

2.Your brother has asked you for a loan and has promised to pay you $9,750 at the end of three years. If you normally invest to earn 5.8 percent per year, how much will you be willing to lend to your brother if you view this purely as a financial transaction (i.e., you don't give your brother a special deal)?

(If you solve this problem with algebra round intermediate calculations to 6 decimal places, in all cases round your final answer to the nearest penny.)

Reference no: EM131916086

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