Bart is saving for college He needs 20000 for the first year

Bart is saving for college. He needs $20,000 for the first year. How much must he invest at a 6% annual interest rate to have $20,000 in five years? Round to the nearest dollar. (the table below may help you answer this question) Present Value Interest Factors Period 2% 4% 6% 8% 10% 12% 15% 20% 1 9804 9615 9434 9259 9091 8929 8696 8333 2 .9612 .9246 8900 8573 .8264 .7972 .7561 .6944 3 9423 8890 8396 7938 7513 7118 6575 5787 9238 8548 7921 7350 6830 6355 5718 A823 5 9057 8319 7473 6806 6209 5674 972 019 8880 .7903 .7050 6302 .5645 .5066 A323 .3349 7 8706 7599 6651 5835 5132 A523 3759 2791 8 8535 7307 6274 5403 4665 4039 3269 2326 8363 .7026 5919 5002 4241 3606 2843 1938 10 8203 6756 5584 4632 3855 3220 2472 1615 11 8043 646 5268 A289 3S0S 2875 2149 1346 12 .7885 .6246 A970 .3971 .3186 2567 .1869 .,122 13 7730 6006 688 3677 2897 2292 1625 0935 14 J579 .5775 A423 .3405 .2633 .2046 .1413 .0779 15 430 .5553 A173 3152 .2394 .1827 .1229 .0649 16 7284 5339 3936 2919 2176 163 109 0541 17 .7142 .5134 .3714703 .1978 .1456 0929 0451 18 7002 4936 3503 2502 1300 0808 0376 19 6864 .4746 330S 2317 .1635 .1161 0703 .0313 2 .6730 .4564 J118 .2145 .1486 .0037 .0611 .0261 Select one: o a. A. $14,982 o b. B. $15.016 O c. C. $15,023 o d. D. $14,946 O e. E. None of the above

Solution

Answer is D $14946

Solution Workings

20000*Pv factor 6% at year 6

20000*.7473 =$14946