Problem 5.17 – Investing to Buy a Ferrari

Fundamentals of Corporate Finance

Ross, Westerfield, and Jordan

13th Edition

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If you have a goal to own a luxury car that costs a certain amount, and you believe that your mutual fund will give you a certain annual rate of return, how much should you invest today in order to be able to buy the car in a set number of years in the future? Figure out how much you should invest today.

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