Suzy Wants to Buy a House but Does Not Want

question 101

Essay

Suzy wants to buy a house but does not want to get a loan. The average price of her dream house is $500,000 and its price is growing at 5 percent per year. How much should Suzy invest in a project at the end of each year for the next 5 years in order to accumulate enough money to buy her dream house with cash at the end of the fifth year? Assume the project pays 12 percent rate of return.

---

Definitions:

Project Champion

An individual, typically within an organization, who passionately supports, promotes, and ensures the success of a project.

Lowest Prices

The minimum monetary amount required to purchase goods or services, often emphasized in competitive markets to attract customers.

Project Infrastructure

The organizational structures, processes, and tools employed to support the successful completion of a project.

Organizational Complexity

Refers to the degree of various interrelated components (such as structure, processes, and cultures) within an organization.