Question

Jim Ryan, an owner of a Burger King restaurant, assumes that his restaurant will need a new roof in 8 years. He estimates the roof will cost him $9,400 at that time.

What amount should Jim invest today at 8% compounded quarterly to be able to pay for the roof?

amount to be invested = ?

Answer 1

Answer:
$5078.53

Explanation:

final amount = 9,400
interest = 8% = 0.8
years = 8

$9,400/1.08^8=5078.52751432≈5078.53