Question: At the end of three years, when you graduate from college, your father has promised to give you a used car that will cost $12,000.

At the end of three years, when you graduate from college, your father has promised to give you a used car that will cost $12,000.

Required:
What lump sum must he invest now to have the $12,000 at the end of three years if he can invest money at?
a. Six percent?
b. Ten percent?

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a From Exhibit 13B1 the factor for 6 for 3 periods is 0... View full answer

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