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A Man wants to buy a house when he retires. The house he has his eye now, in 1990, on costs $200,000. He estimates he
A Man wants to buy a house when he retires. The house he has his eye now, in 1990, on costs $200,000. He estimates he will retire in 10 years. He wants to put enough money in his savings account at 7% interest, compounded annually, so that he can afford the house when he retires. He assumes inflation for the next 10 years will average 3% per year. What will the house cost when he wants to buy. What lump sum should he put in the savings account today (1990) so he will have enough to buy it in 10 years..
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