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Alan Bowie is trying to determine the amount to set aside so that he will have enough money on hand in 3 years to
Alan Bowie is trying to determine the amount to set aside so that he will have enough money on hand in 3 years to overhaul the engine on his vintage used car. While there is some uncertainty about the cost of engine overhauls in 3 years, by conducting some research online, Alan has developed the following estimates. Engine Overhaul Estimated Cash Outflow Probability Assessment $360 10% 550 30% 800 50% 720 10% Click here to view factor tables. How much should Alan Bowie deposit today in an account earning 6%, compounded annually, so that he will have enough money on hand in 3 years to pay for the overhaul? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to O decimal places, e.g. 458,581.) Deposit amount $
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