Jan wants to plan for her daughter's education. Her daughter, Rachel was born today and will...

 

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Jan wants to plan for her daughter's education. Her daughter, Rachel was born today and will go to college at age 18 for five years. Tuition is currently $15,500 per year, in today's dollars. Jan anticipates tuition inflation of 6% and believes she can earn an 10% return on her investment. How much must Jan save at the end of each year, if she wants to make her last payment at the beginning of her daughter's first year of college? Jan wants to plan for her daughter's education. Her daughter, Rachel was born today and will go to college at age 18 for five years. Tuition is currently $15,500 per year, in today's dollars. Jan anticipates tuition inflation of 6% and believes she can earn an 10% return on her investment. How much must Jan save at the end of each year, if she wants to make her last payment at the beginning of her daughter's first year of college?

Answer rating: 100% (QA)

To calculate how much Jan must save at the end of each year we can use the future value of an ordina... View the full answer