investments. sheldon cooper and amy fowler are married and live in pasadena, california. they have as a new investment goal to create a college fund for their newborn daughter. they estimate that they will need $200,000 in 18 years. assuming that the cooper-fowler family could obtain a return of 5 percent, how much would they need to invest annually to reach their goal? garman, e. thomas; forgue, raymond. personal finance (p. 419). cengage learning. kindle edition.

Respuesta :

They need to invest $7109.25 annually to reach their goal.

let X be the  amount to be  invested annually

=>FV  = 200000

X * [(1+5%)^18 -1]/5%  = 200000

=>X = $7109.25

hence they need to invest $7109.25 annually.

An investment is an asset or object received with the goal of producing earnings or appreciation. Appreciation refers to a growth in the cost of an asset over the years. when an individual buy a good as an investment, the purpose is not to consume the good but as a substitute to using it inside the destiny to create wealth. investment definition is an asset received or invested in to build wealth and save cash from the tough-earned income or appreciation. funding means more often than not to attain a further supply of income or advantage and make the most of the investment over a particular time frame.

The funding provides the inventory of capital, and the quantity of capital to be had in a financial system is a critical determinant of its productivity. investment for that reason contributes to economic increase. An investment technique is a set of suggestions that govern the conduct of traders in a way that permits them to remain faithful to the tenets of their funding method.

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