Joe, a School graduate you recently hired, needs $40,000 in 3 years to buy the car of his dreams. If his investments earn 6% interest per year, how much must he invest today?

Since Joe does not have enough cash today to meet his goal he decides he should to invest equal amounts over the next three years beginning at the end of this year. If the fair interest rate is 6% annually, how much will he need to invest each year?

How much would Joe need to invest annually if he invests an equal amount over the next three years beginning immediately (three payments total)?