Considering two savings options that provide rate of return

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Reference no: EM131043698

You are considering two savings options that each provide a rate of return of 4.65 percent. The first option requires annual savings of $2,000, $2,500, and $3,000 over the next three years, respectively, with the first deposit due one year from today. The other option is to save one lump sum amount today. If you want to have the same balance in your savings at the end of the three years, regardless of the savings method you select, how much do you need to save today if you select the lump sum option?

Reference no: EM131043698

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