Omar wants to buy a house in another 7 years. The type of house he wants to buy is currently selling for OR 50,000, and the price will increase at a compound rate of 10% per year. Omar can presently invest in a bank fixed deposit earning a compound annual rate 14% per year. How much money must Omar deposit in the bank each year to be able to purchase a house in 7 years from now?

Omar wants to buy a house in another 7 years. The type of house he wants to buy is currently selling for OR 50,000, and the price will increase at a compound rate of 10% per year. Omar can presently invest in a bank fixed deposit earning a compound annual rate 14% per year. How much money must Omar deposit in the bank each year to be able to purchase a house in 7 years from now?

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter27: Time Value Of Money (compound)

Section: Chapter Questions

Problem 6E

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