A father is now planning a savings program to put his daughter through college. She is 13,

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A father is now planning a savings program to put his daughter through college. She is 13, plans to enroll at the university in 5 years, and should graduate 4 years later. Currently, the annual cost (for everything-food, clothing, tuition, books, transportation, and so forth) is $15,000, but these costs are expected to increase by 5% annually. The college requires total payment at the start of the year. She now has $7,500 in a college savings account that pays 6% annually. Her father will make six equal annual deposits into her account; the first deposit today and the sixth on the day she starts college. How large must each of the six payments be?
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Related Book For  answer-question

Fundamentals of Financial Management

ISBN: 978-1285867977

14th edition

Authors: Eugene F. Brigham, Joel F. Houston

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