What annual deposit will allow to reach goal

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Problem 1: You establish a goal of buying a house in 5 years with a 50% down payment. You estimate that the kind of house you want will sell for $280,000 at the time you buy it. Assuming you can earn a 4% annual return on your fund balance, that you will make equal annual investments, and that you will invest at the end of each of the 5 years, what annual deposit will allow you to reach your goal?

Problem 2: You are about to buy a car. The specific model and features you selected will cost $35,000 beyond the amount you will pay at the time of purchase. You will borrow that additional $35,000. Your credit union will charge you 4.5% interest on your 3-year loan. Assume you will make annual payments on this loan. What is the amount of your payment?

Reference no: EM132822664

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