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Mary and Joe would like to save up $10,000 by the end of three years from now to buy new furniture for their h?
Mary and Joe would like to save up $10,000 by the end of three years from now to buy new furniture for their home. They currently have $1500 in a savings account set aside for the furniture. They would like to make three equal year end deposits to this savings account to pay for the furniture when they purchase it three years from now. Assuming that this account pays 6% interest, how much should the year end payments be?
use a financial calc
PV= -1500 what they have now
FV=10000 what they need to have
i=6 %
n=3 compounding periods
PMT=? what they need to put in
solve for PMT= $2579.93
High End Furniture Design and Manufacturing