Suppose that you are obtaining a personal loan from your uncle in the amount of $20,000 (now) to be repaid in two years to cover some of your college expenses. If your uncle usually earns minimum 8% profit (annually) on his money, which is invested in various sources, what minimum lump-sum payment two years from now would make your uncle happy?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Suppose that you are obtaining a personal
loan from your uncle in the amount of
$20,000 (now) to be repaid in two years to
cover some of your college expenses. If your
uncle usually earns minimum 8% profit
(annually) on his money, which is invested in
various sources, what minimum lump-sum
payment two years from now would make
your uncle happy?
Transcribed Image Text:Suppose that you are obtaining a personal loan from your uncle in the amount of $20,000 (now) to be repaid in two years to cover some of your college expenses. If your uncle usually earns minimum 8% profit (annually) on his money, which is invested in various sources, what minimum lump-sum payment two years from now would make your uncle happy?
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