Payments required-single payment made

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Reference no: EM131886589

Payments required

You need $25,056 at the end of six years, and your only investment outlet is a 12 percent long-term certificate of deposit (compounded annually). With the certificate of deposit, you make an initial investment at the beginning of the first year. Use Appendix B and Appendix C.

(a) What single payment could be made at the beginning of the first year to achieve this objective? (Round "PV Factor" to 3 decimal places and final answer to 2 decimal places. Omit the "$" sign in your response.)

Single payment made $

(b) What amount could you pay at the end of each year annually for six years to achieve this same objective? (Round "FV Factor" to 3 decimal places and final answer to the nearest dollar amount. Omit the "$" sign in your response.)

Amount to be paid $

Reference no: EM131886589

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