Carlos wants to invest enough money now to have $25,000 in three years to buy a new car.If interest rates are 4%, the amount he needs to invest now is closest to:

Question

Quizplus · Accepted Answer

To find the present value, use the formula: Present Value = Future Value / (1 + r)^n, where r is the interest rate and n is the number of years. Plugging in the values: $25,000 / (1 + 0.04)^3 ≈ $22,224.

Carlos Wants to Invest Enough Money Now to Have $25,000