A firm sets aside $26000 today in an account earning 8% APR compounded annually.  The purpose of the 'set aside' is to finance a contracted payment of $35,000 that will occur four years from today.  Is the $26000 sufficient? A) No, because the FV of $26000 is less than $35000   B) Yes, because the FV of $26000 is less than $35000   C) Yes, because the FV of $26000 is greater than $35000   D) No, because the FV of $26000 is greater than $35000

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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A firm sets aside $26000 today in an account earning 8% APR compounded annually.  The purpose of the 'set aside' is to finance a contracted payment of $35,000 that will occur four years from today.  Is the $26000 sufficient?

A) No, because the FV of $26000 is less than $35000
 
B) Yes, because the FV of $26000 is less than $35000
 
C) Yes, because the FV of $26000 is greater than $35000
 
D) No, because the FV of $26000 is greater than $35000
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