1. On her 10th birthday, Emma inherits $20,000, which is to be used for her college education....

Question:

1. On her 10th birthday, Emma inherits $20,000, which is to be used for her college education. The money is deposited into a trust fund at 3% interest compounded annually that will pay her R dollars on her 18th, 19th, 20th, and 21st birthdays.
(a) How much money will be in the trust fund on Emma's 17th birthday?
(b) Find the value of R. Note: R is the rent on a decreasing with a duration of 4 years.
2. College Fund Refer to Exercise 1. Find the size of the inheritance that would result in $10,000 per year during the college years (ages 18-21, inclusive)?
Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...