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john wishes to pay $1000 a year for 3 years, starting 5 years from today. interest...

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Finance

john wishes to pay $1000 a year for 3 years, starting 5 years fromtoday. interest rates are forecast at 2% compounded monthly overthe next two years and 4% compounded monthly there after. how muchmust he set aside today?

Answer & Explanation Solved by verified expert
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Assume that the amount of money John must set aside today is X To know the amount of money John must set aside today we have to calculate the present value of all future cash flows The    See Answer
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john wishes to pay $1000 a year for 3 years, starting 5 years fromtoday. interest rates are forecast at 2% compounded monthly overthe next two years and 4% compounded monthly there after. how muchmust he set aside today?

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