Personal Finance 1st Edition by Jack R. Kapoor

Exercise 27

Calculating Present Value of a Savings Fund. Hal Thomas wants to establish a savings fund from which a community organization could draw $800 a year for 20 years. If the account earns 3 percent, what amount would he have to deposit now to achieve this goal? (Obj. 5)

Step 1 of 2

Calculate the amount that needs to be deposited to achieve the goal:

Given: