Answer:
Amount to be kept separately for having $17,000 at year end = $16,715.83
Step-by-step explanation:
As it is provided, that annual return = 1.7% compounded annually.
We need to calculate the amount to be invested today, to get a total of $17,000 at year end.
Since the interest is compounded annually, it is a simple interest if the term is of 1 year.
Therefore,
Investment + Investment [tex]\times[/tex] 1.7% = $17,000
Investment + 0.017 Investment = $17,000
1.017 Investment = $17,000
Investment = [tex]\frac{17,000}{1.017} = 16,715.83[/tex]
Therefore, Investment today = $16,715.83
