You begin an investment plan by putting $10,000 in an account that you assume will earn 8%

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You begin an investment plan by putting $10,000 in an account that you assume will earn 8% annually. For the next 25 years, you add $5000/y. In anticipation of buying a house with a 15-year mortgage, you expect to need a onetime down payment of $55,000 at the end of year 8. You anticipate being able to make the monthly mortgage payment without affecting the yearly contribution to the savings plan.

1. Draw a discrete, nondiscounted cash flow diagram for this situation.

2. Will you have the down payment at the end of year 8?

3. What will be the value of your savings account at the end of year 25?

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Analysis Synthesis And Design Of Chemical Processes

ISBN: 9780134177403

5th Edition

Authors: Richard Turton, Joseph Shaeiwitz, Debangsu Bhattacharyya, Wallace Whiting

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