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posted by  XeRoX2k2 on 10/5/2008 10:03:34 PM  |  status: Live  

impossible math of finance question

Course Textbook Chapter Problem
N/A mathematics of investment and credit,3rd edition, broverman 2.1 10
Question Details:
chuck needs to purchase an item in 10 years. The item costs 200 today, but its price inflates 4% per year. To finance the purchase, chuck deposits 20 into an account at the beginning of each year for 6 years. He deposits an additional x at the beginning of years 4,5,6 to meet his goal. The effective annual interest rate is 10% calculate X.

x should be between 8 and 9

future value of the 200 is found by: 200(1.04)^10 which is 296.05 that part of the equality i know,it the other side that's the problem
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