D.8. A prosperous consulting engineer decides to aid student engineers by establishing a student loan fund. The provisions of the loan follow: PART ONE Basic Principles 98 1. Each student is eligible for a loan of $5,000 per year at the beginning of each year of the four college years. 2. Interest accrues at 4 percent per year on the outstanding balance of the loan, com- pounded at the end of each, year, until repaid in full. 3. Graduation occurs at EOY 4, and repayments are to be made in 10 equal end-of-year payments, with the first payment due two years after graduation. (a) Draw a cash flow diagram for the program, using only one student loan as an example. (b) Find the equal annual series repayment amounts. (c) If the consultant borrows at 15 percent, find the present value of the subsidy for each loan. (In terms of PV, how much does each loan cost the consultant?) monthly D.8. A prosperous consulting engineer decides to aid student engineers by establishing a student loan fund. The provisions of the loan follow: PART ONE Basic Principles 98 1. Each student is eligible for a loan of $5,000 per year at the beginning of each year of the four college years. 2. Interest accrues at 4 percent per year on the outstanding balance of the loan, com- pounded at the end of each, year, until repaid in full. 3. Graduation occurs at EOY 4, and repayments are to be made in 10 equal end-of-year payments, with the first payment due two years after graduation. (a) Draw a cash flow diagram for the program, using only one student loan as an example. (b) Find the equal annual series repayment amounts. (c) If the consultant borrows at 15 percent, find the present value of the subsidy for each loan. (In terms of PV, how much does each loan cost the consultant?) monthly