In the aftermath of the mortgage crisis, Kyle and Mary Ellis from Las Vegas, NV, are considering remodeling their home. They originally wanted to sell their home and move to another area, but news from the Las Vegas Sun continues to show a decline in real estate values. Their plan now is to improve their home’s curb appeal as well as update the interior. They estimate the cost will be $66,900. How much must they invest today at 12% interest compounded quarterly in order to have the money they need to remodel in 8 years?

Question

In the aftermath of the mortgage crisis, Kyle and Mary Ellis from Las Vegas, NV, are considering remodeling their home. They originally wanted to sell their home and move to another area, but news from the Las Vegas Sun continues to show a decline in real estate values. Their plan now is to improve their home’s curb appeal as well as update the interior. They estimate the cost will be $66,900.     How much must they invest today at 12% interest compounded quarterly in order to have the money they need to remodel in 8 years?