The Stein family wants to buy a small vacation house in a year and a half. They expect it to cost $75,000 at that time. They have the following sources of money.
1. They have $10,000 currently in a bank account that pays 6% compounded monthly.
2. Uncle Murray has promised to give them $1,000 a month for 18 months starting today.
3. At the time of purchase, they’ll take out a mortgage. They anticipate being able to make payments of about $300 a month on a 15-year, 12% loan.
In addition, they plan to make quarterly deposits to an investment account to cover any shortfall in the amount required. How much must those additions be if the investment account pays 8% compounded quarterly?