Question: Keith Bowie is trying to determine the amount to set aside so that he will have enough money on hand in 2 years to overhaul

Keith Bowie is trying to determine the amount to set aside so that he will have enough money on hand in 2 years to overhaul the engine on his vintage used car. While there is some uncertainty about the cost of engine overhauls in 2 years, by conducting some research online, Keith has developed the following estimates.

InstructionsHow much should Keith Bowie deposit today in an account earning 6%, compounded annually, so that he will have enough money on hand in 2 years to pay for theoverhaul?

Engine Overhaul Estimated Cash Outflow Probability Assessment $200 10% 30% 450 600 750 50% 10%

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