Question

Betsy Parker wants to buy a house in next 10 years and decides to have a SMART goal of having $40,000 as down payment. With the investment that gives interest rate of 5%, how much money she needs to set aside now

Answer 1

$24,556.53

Step-by-step explanation:

We are to find the present value

PV = FV x (1 + r) ^-n

FV = Future value

PV = Present value

R = interest rate

N = number of years

$40,000 x(1.05)^-10 = $24,556.53