A Company Needs to Have $150,000 in 5 Years, and Will

question 70

Short Answer

A company needs to have $150,000 in 5 years, and will create a fund to insure that the $150,000 will be available. If it can earn a 6% return compounded annually, how much must the company invest in the fund today to equal the $150,000 at the end of 5 years?

---

Definitions:

Provisional Credit

Temporary credit issued by a bank to an account holder's account, pending investigation or finalization of a transaction.

Deposits

Funds placed into a bank account for safekeeping or as a pledge as part of a financial transaction.

Certified

Officially recognized as possessing certain qualifications or meeting specific standards.

Forges

The act of illegally copying or fabricating something, usually documents, artwork, or currency, with the intent to deceive.