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Example 3: Expected Cash Flow Approach Keith Bowie is trying to determine the amount to set aside so that he will have enough money on

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Example 3: Expected Cash Flow Approach Keith Bowie is trying to determine the amount to set aside so that he will have enough money on hand in 2 years to overhaul the engine on his vintage used car. While there is some uncertainty about the cost of engine overhauls in 2 years, by conducting some research online, Keith has developed the following estimates. Engine verhaul Estimated Cash Dutow Probability Assessment $2DD 1U% 45D 39% 60D 55% FEB 10% Instructions How much should Keith Bowie deposit today in an account earning 5%, compounded annually, so that he will have enough money on hand in 2 years to pay for the overhaul

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