John Fillmore’s lifelong dream is to own his own fishing boat to use in his retirement. John has recently come into an inheritance of $400,000. He estimates that the boat he wants will cost $300,000 when he retires in 5 years. How much of his inheritance must he invest at an annual rate of 8% (compounded annually) to buy the boat at retirement?

Q: Calculate the return that Lin Shan is earning on her annuity.

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A: Future value:

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A: Annuity is the term used for a payment if it is done repeatedly.

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A:

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A: Formulas:

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A:

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A: The computation of the present value as follows:

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