Exercise 13A-3 Basic Present Value Concepts [LO13-7]

In three years, when he is discharged from the Air Force, Steve wants to buy an $13,000 power boat.

Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using tables.

Required:

What lump-sum amount must Steve invest now to have the $13,000 at the end of three years if he can invest money at: (Round your final answer to the nearest whole dollar amount.)