Inflation, time value, and annual deposits Personal Finance Problem While vacationing in Florida, John Kelley saw the vacation home of his dreams. It was listed with a sale price of $209,000. The only catch is that John is 42 years old and plans to continue working until he is 65. John believes that prices generally increase at the overall rate of inflation and that he can earn 11% on his investments. He is willing to invest a fixed amount at the end of each of the next 23 years to fund the cash purchase of such a house one that can be purchased today for $209,000) when he retires. a. Inflation is expected to average 4% a year for the next 23 years. What will John's dream house cost when he retires? b. How much must John invest at the end of each of the next 23 years to have the cash purchase price of the house when he retires? c. If John invests at the beginning instead of at the end of each of the next 23 years, how much must he invest each year? Value of a mixed stream For the mixed stream of cash flows shown in the following table, E: determine the future value at the end of the final year if deposits are made into an account paying annual interest of 9%, assuming that no withdrawals are made during the period and that the deposits are made: a. At the end of each year. b. At the beginning of each year. a. The future value at the end of the final year if deposits are made at the end of each year is $ (Round to the nearest dollar.) Data table b. The future value at the end of the final year if deposits are made at the beginning of each year is $ (Round to the nearest dollar.) (Click on the icon here 2 in order to copy the contents of the data table below into a spreadsheet.) Year 1 2 Cash flow stream $33,900 $28,250 $22,600 $11,300 $5,650 3 4 5 Print Done