Question $9$

Bill and Dorothy Smith just had their first child. They would like to save money to give their

child $$200,000$ on their ${21}^{st}$ birthday for a downpayment on a house. He assumes with good

asset allocation and stock selection in his portfolio, he could earn $8\%$ per year. How much do

the Smiths have to invest in the portfolio at the end of each year to have $$200,000$ in $21$

years?

$$5,754\mathrm{.}92$

$$3,966\mathrm{.}45$

$$2,478\mathrm{.}55$

$$7,689\mathrm{.}80$