Abby owns a business that projects two years of strong cash flow, followed by a two-year hiatus

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Abby owns a business that projects two years of strong cash flow, followed by a two-year hiatus while she pursues a graduate degree. She then plans to resume her business and is confident about the following two years of cash flow. At the end of each year, she will invest her profits in a fund that returns 3% compounded annually. Each investment will be made at the end of the year. Her expected investments are as follows:

Year 1: $50,000

Year 2: $78,000

Year 3: 0

Year 4: 0

Year 5: $84,000

Year 6: $89,000

If Abby meets her expectations, how much money will she have in this fund at the end of year 7?

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Principles Of Finance

ISBN: 9798439388899

1st Edition

Authors: Julie Dahlquist, Rainford Knight

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