Angela Contreras is trying to determine the amount to set aside so that she will have enough money on hand in 2 years to overhaul the engine on her vintage used car. While there is some uncertainty about the cost of engine overhauls in 2 years, by conducting some research online, Angela has developed the following estimates
Engine Overhaul Estimated Cash Outflow Probability Assessment
$200.................................................................................10%
450...................................................................................30%
600...................................................................................50%
750...................................................................................10%
Instructions
How much should Angela Contreras deposit today in an account earning 6%, compounded annually, so that she will have enough money on hand in 2 years to pay for the overhaul?