How much must be deposited today into the following account in order to have $ 25,000 in 8 years for a down payment on a house? Assume no additional deposits are made.

Question

How much must be deposited today into the following account in order to have $ 25,000 in 8 years for a down payment on a​ house? Assume no additional deposits are made.
An account with annual compounding and an APR of 5​%

$______ should be deposited today

Damon · Answer

1.05^8 = 1.477455 25,000 / 1.477455 = 16,921

How much must be deposited today into the following account in order to have $ 25,000 in 8 years for a down payment on a​ house? Assume no additional deposits are made.

How much must be deposited today into the following account in order to have $ 25,000 in 8 years for a down payment on a house? Assume no additional deposits are made.