Alfredo wants to know how much he must put in a bank account today to have within 14 years an amount equivalent to $ 20,000 in value today (year 0). Inflation is 8%. The interest rate offered by the bank is 5% per year. a) Calculates the conversion to current dollars of $20,000 $ b) How much should you deposit with the bank today to achieve your goal? $
Alfredo wants to know how much he must put in a bank account today to have within 14 years an amount equivalent to $ 20,000 in value today (year 0). Inflation is 8%. The interest rate offered by the bank is 5% per year. a) Calculates the conversion to current dollars of $20,000 $ b) How much should you deposit with the bank today to achieve your goal? $
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
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Alfredo wants to know how much he must put in a bank account today to have within 14 years
an amount equivalent to $ 20,000 in value today (year 0). Inflation is 8%. The interest rate
offered by the bank is 5% per year. a) Calculates the conversion to current dollars of $20,000 $
. b) How much should you deposit with the bank today to achieve your goal? $
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