Your father has found out that you are taking a finance course and has asked you to
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Question:
Sofia will enter college (a 4-year degree) in exactly 12 years. In 12 years, college will cost $40,000 per year and will increase at a rate of 3% per year? Payments to the college are due at the beginning of the school year. (Thus, the first payment is due in 12 years from the day after your father opens the Sofia account)?
Your father will invest each year (at the end of each year) in an account today with a 6% annual compounding rate. Finally, Sofia's aunt promises to deposit $5,000 into the account when Sofia turns 16 in exactly 10 years (a single deposit from her aunt). How much would your dad need to deposit each year for the next 12 years in order to send Sofia to college?
Related Book For
Fraud examination
ISBN: 978-0538470841
4th edition
Authors: Steve Albrecht, Chad Albrecht, Conan Albrecht, Mark zimbelma
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