Plato donated 40,000 toward future scholarships for students in his Academy. The scholarships will pay 1,000 at the end of year 1, 1,500 at the end of year 2, 2,000 at the end of year 3 and so on, with the amount increasing 500 each year until the scholarship reaches 5,000. The annual scholarship will remain at 5,000 until the fund is depleted. If the account balance is less than 5,000 at the time of payment, that amount will be rewarded as a smaller scholarship and the account will be closed. The scholarship fund earns interest at an effective annual rate of 8%. Determine how many full 5,000 scholarships will be awarded.

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To determine how many full 5000 scholarships will be awarded we need to calculate the total future v... View the full answer