Nancy would like to accumulate $10,000 by the end of 3 years from now to buy a sports car from her friend, Jim. She has $2,500 now and would like to save equal annual end-of-year deposits to pay for the car. How much should she deposit at the end of each year in an account paying 8 percent interest to buy the car?
What will be an ideal response?
Using financial calculator: PV = -2,500, N = 3, I = 8, FV = 10,000, CPT PMT = 2,110.25
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