TVM: How much would you have to deposit now

How much would you have to deposit now into an account that earns 3% per month to fund a $100 withdrawal in month 24?

The given situation follows the singleton equation patterns - the money increases by 3% per month and nothing else. So, since you are trying to find the present worth of $100 in the future, you would need to use the singleton equation: P = F / (1+i)N
Note: This equation is also written as P = (F)*(1+i)-N

P = F / (1+i)N
P = ($100)/(1+.03)(24)
P = $49.19

So, you would have to deposit $49.19 now to fund a future $100 withdrawal.

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