Question $1$

$10pts$

The Gardner's would like to send their daughter to a music camp at the end of each of the next four years. The camp costs $$800$ a year. What lump sum amount would have to be invested now to have $$800$ at the end of each year if the rate of return is $3\%?$

$$711$

$$89$

$$900$

$$2,974$

Question $2$

$10pts$

Drezden Company will need new equipment in three years. The equipment will cost $$400,000.$ What lump sum will Drezden have to invest today at $4\%$ rate of return to have $$400,000$ available in three years?

$$355,599$

$$449,946$

$$470,000$

$$562,432$