You will have a property tax payment due in 12 months that will cost $5,618. How...

You will have a property tax payment due in 12 months that will cost $5,618. How much do you have to invest today to have just enough to pay your property tax bill if your investments earn 5.82% APR (compounded monthly)?

Expert Solution

Answer:- Future Value = Present Value x (1 + interest rate per period)^{Number of periods}

$5,618 = Present Value x [1 + (0.0582/12)]¹²

Present Value = $5618 /1.05977786

= $5301.110935

or

= $5301.11

jeff jeffy answered 2 years ago

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