5. (10 pts) Irene just purchased a new shorts car and wants to also set aside ca

Question

5. (10 pts) Irene just purchased a new shorts car and wants to also set aside cash bumper-to-bumper warranty for for future maintenance expenses. The car has a the first five years. Irene estimates that she year in maintenance expenses for years 6-10, at vehicle. How much money should i ene deposit into an account today, at 8% per year, so that she will have sufficient funds in that account to cover her projected maintenance expenses? will need approximately $2,000 per which time she ill sell the

Explanation / Answer

As for the First five years there is warranty on the car so there will be no charges.

Changes for Next Five years(6-10) = 2000*5 = 10000

Suppose she will get interest of x amount in 5 year on 8% interest rate= 2000*5*8/100; x = 800;

So She has to deposit = 1850.50 $ per year so that she will get interest of 740 in 5 years.

Related Questions

Navigate

• Browse (All)
• Browse 5
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.