Karen and Mike currently insure their cars with separate companies, paying $800 and $1,000 a year. If they insured both cars with the same company, they would save 10 percent on the annual premiums. What would be the future value of the annual savings over 10 years based on an annual interest rate of 4 percent? Use Exhibit 1-B 12.006 . (Round FVA factor to 3 decimal places and final answer to 2 decimal places.)

Karen and Mike currently insure their cars with separate companies, paying $800 and $1,000 a year. If they insured both cars with the same company, they would save 10 percent on the annual premiums. What would be the future value of the annual savings over 10 years based on an annual interest rate of 4 percent? Use Exhibit 1-B 12.006 . (Round FVA factor to 3 decimal places and final answer to 2 decimal places.)

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 28P

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