Delph cosmetics has a 130000 liability it must pay four


Question: Delph Cosmetics has a $130,000 liability it must pay four years from today. The company is opening a savings account so that the entire amount will be available when this debt comes due. The plan is to make an initial deposit today and then deposit an additional $20,000 at the end of each of the four years. The account pays a 4.5 percent rate of return. How much does the firm need to deposit today?

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Finance Basics: Delph cosmetics has a 130000 liability it must pay four
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