Tim Howard has been offered the opportunity of investing $45,900 now. The invest

Question

Tim Howard has been offered the opportunity of investing $45,900 now. The investment will earn 6% per year and at the end of that time will return Tim $82,200. Click here to view the factor table Future Value of 1 Click here to view the factor table Future Value of an Annuity of 1 Click here to view the factor table Present Value of 1 Click here to view the factor table Present Value of an Annuity of 1 (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) How many years must Tim wait to receive $82,200?

(Hint: Use Table 3.) (Round answer to 0 decimal places, e.g. 25.) Tim must wait ________ years

Explanation / Answer

Future value factor = 82200/45900= 1.79085 The future value factor 1.79085 at 6% is closest at 10 years Tim must wait 10 years

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