E $5-17$

Future value;

solving for

annuities and

single amount

LO$5-4,$ LO$5-9$

Parents want to accumulate $$100,000$ to be used for their child's college education. The parents would like to have

the amount available on December $31,2029.$ Assume that the funds will accumulate in an account paying $8\%$

interest compounded annually.

Required:

Answer each of the following independent questions.

If they were to deposit a single amount, how much would they have to invest on December $31,2024?$

If they were to make five equal deposits on each December $31,$ beginning on December $31,2025,$ what is the

required amount of each deposit?

If they were to make five equal deposits on each December $31,$ beginning on December $31,2024,$ what is the

required amount of each deposit?