## Interest:

The interest income or expense could be determined using the compound interest rate method or the simple interest rate method. The simple interest is computed over the principal amount.

The required amount to be deposited today is $16,731.19. Explanation: The required amount to be deposited today is$16,731.19 (\$30,250/1.808), which has been computed by dividing the future money by interest rate increased by 100%. The amount has been obtained by reverse computation.

Working Note: The total expected interest over the period is 80.8% (4% x 5 + 4.60% x 4 + 5.30% x 8).

Note: The value has been computed based on the simple interest rate.