Over the past several years, Catherine Lee has been able to save regularly. As a result, she has $54,188 in savings and investments today. She wants to establish her own business in five years and feels she will need $100,000 to do so.

a. If she can earn 4 percent on her money, how much will her $54,188 in savings/investments be worth in five years? Will Catherine have the $100,000 she needs? If not, how much more money will she need?

b. Given your answer to part a, how much will Catherine have to save each year over thenext five years to accumulate the additional money? Assume that she can earn interestat a rate of 4 percent.

c. If Catherine can afford to save only $4,000 a year, then given your answer to part a, will she have the $100,000 she needs to start her own business in five years?