Kathy has $50,000 to invest today and would like to determine whether it is realistic for her to achieve her goal of buying a home for $150,000 in 10 years with this investment. What return must she achieve in order to buy her home in 10 years?
A) Above 10%
B) Between 8% to 10%
C) Exactly 10%
D) Below 8%

Question

Quizplus · Accepted Answer

PV_IF= PV/FV (App. B: 10 periods) = $50,000/$150,000 = 0.333 Return = above 10%

Kathy Has $50,000 to Invest Today and Would Like to Determine