Beginning three months from now, you will need $1,500 each quarter for the next four years to cover expenses. How much do you need to have saved today to meet these needs if you can earn .35 percent Interest per quarter?a.$23,300.75 b.$26,84715 c.$21,068.00 d.$22,319.54 e.$26.069.79

The correct answer is A.

Explanation:

Giving the following information:

Beginning three months from now, you will need $1,500 each quarter for the next four years to cover expenses.

We need to determine the present value needed to cover expenses. The interest rate is 0.35% per quarter.

First, we need to calculate the final value:

FV= {A*[(1+i)^n-1]}/i

A= quarterly expense= 1,500

i= 0.0035

n= 16

FV= {1,500*[(1.0035^16) - 1]/ 0.0035= 24,640.41

Now, we can calculate the present value:

PV= FV/(1+i)^n

PV= 24,640.41/ (1.0035^16)= $23,300.75

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