You figure that the total cost of college will be $100,000 per year 18 years from today If your discount rate is 8 compounded annually, what is the present value today of 4 years of college costs starting 18 years from today ...

Plan This is a deferred annuity The cash flow timeline is 0 1 17 18 21 0 0 10 ...

You figure that the total cost of college will be $100,000 per year 18 years from today.

Question:

You figure that the total cost of college will be $100,000 per year 18 years from today. If your is 8% compounded annually, what is the present value today of 4 years of college costs starting 18 years from today?

Discount Rate
Depending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal...