Abu Saud would like to give his son a sum of money in 4 years if he is successful in completing his study. His son plans to use the money to buy a car which will cost SAR 60,000.

a. What would be the amount he needs to give to his son now to reach the goal of buying the

car if the money is invested in an account with a return of 10% compounded annually? b. If Abu Saud invested SAR 40,000 in the account now but at 10% simple interest rate

annually. Can his son reach the goal of buying the car? You should explain you answer.