You are a financial adviser, and your client wants to save $6,000 in order to make a downpayment for a car in two years. Your bank offers a savings account which pays 3.6% compounded quarterly. The client wishes to make deposits at the end of each three-month period. What is the amount of the annuity the client needs to pay in order to meet the goal? (Choose the closest number.) a) $718.44. b) $726.69 c) $734.16 O d) $741.92 e) None of these.

You are a financial adviser, and your client wants to save $6,000 in order to make a downpayment for a car in two years. Your bank offers a savings account which pays 3.6% compounded quarterly. The client wishes to make deposits at the end of each three-month period. What is the amount of the annuity the client needs to pay in order to meet the goal? (Choose the closest number.) a) $718.44. b) $726.69 c) $734.16 O d) $741.92 e) None of these.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 25PROB

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You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the third year. B. Use the future value of $1 table In Appendix B and verify that your answer is correct.
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