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- A father is now planning a savings program to put his daughter through college. She is 13, plans to enroll at the university in 5 years, and she should graduate 4 years later. Currently, the annual cost (for everything - food, clothing, tuition, books, transportation, and so forth) is $18,000, but these costs are expected to increase by 6% annually. The college requires total payment at the start of the year. She now has $6,000 in a college savings account that pays 8% annually. Her father will make six equal annual deposits into her account; the first deposit today and sixth on the day she starts college. How large must each of the six payments be? (Hint: Calculate the cost (inflated at 6%) for each year of college and find the total present value of those costs, discounted at 8%, as of the day she enters college. Then find the compounded value of her initial $6,000 on that same day. The difference between the PV of costs and the amount that would be in the savings account must be…A father is now planning a savings program to put hisdaughter through college. She is 13, plans to enroll at the university in 5 years, and shouldgraduate 4 years later. Currently, the annual cost (for everything—food, clothing, tuition,books, transportation, and so forth) is $12,000, but these costs are expected to increase by6% annually. The college requires total payment at the start of the year. She now has $10,000in a college savings account that pays 9% annually. Her father will make six equal annualdeposits into her account; the first deposit today and the sixth on the day she starts college.How large must each of the six payments be? (Hint: Calculate the cost (inflated at 6%) foreach year of college and find the total present value of those costs, discounted at 9%, as ofthe day she enters college. Then find the compounded value of her initial $10,000 on thatsame day. The difference between the PV of costs and the amount that would be in the savingsaccount must be made up by the…A father is planning a savings program to put his daughter through university. His daughter is now 13 year old. She plans to enroll at the university in 5 years, and it should take her 4 years to complete her education. Currently, the cost per year (for everything – her food, clothing, tuition, books, transportation, and so forth) is GH¢ 12,000 per year. This cost is expected to remain constant throughout the four-year university education. The daughter recently received GH¢ 7,500 from her grandfathers, estate; this money will be invested at a rate of 8% to help meet the costs of the daughter’s education. The rest of the costs will be met by money the father will deposit in a savings account which also earns 8 percent compound interest per year. He will make 5 equal deposits into the account, one deposit per annum starting one year from now until his daughter starts university. These deposits will begin one year from now. (Assume that school fees are paid at the beginning of the year)…
- Your parents have accumulated a $160,000 nest egg. They have been planning to use this money to pay college costs to be incurred by you and your sister, Courtney. However, Courtney has decided to forgo college and start a nall salon. Your parents are giving Courtney $31,000 to help her get started, and they have decided to take year-end vacations costing $11,000 per year for the next fou years. Use 9 percent as the appropriate interest rate throughout this problem. Use Appendix A and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods. a. How much money will your parents have at the end of four years to help you with graduate school, which you will start then? (Roun your final answer to 2 decimal places.) Funds available for graduate school b. You plan to work on a master's and perhaps a PhD. If graduate school costs $29,260 per year, approximately how long will you be able to stay in school based on these funds?…Joann wants to save for her daughter's education. Tuition costs $9,000 per year in today's dollars. Her daughter was born today and will go to school starting at age 18. She will go to school for 4 years. She can earn 12% on her investments and tuition inflation is 6%. How much must she save at the end of each year if she wants to make her last savings payment at the beginning of her daughter's first year of college? $1,889 $2,117 $2,370 $1,700Your parents have accumulated a $120,000 nest egg. They have been planning to use this money to pay college costs to be incurred by you and your sister, Courtney. However, Courtney has decided to forgo college and start a nail salon. Your parents are giving Courtney $15,000 to help her get started, and they have decided to take year-end vacations costing $10,000 per year for the next four years. How much money will your parents have at the end of four years to help you with graduate school? You plan to work on a master’s and perhaps a PhD. If graduate school costs $26,353 per year, approximately how long will you be able to stay in school based on these funds? Use 9 percent as the appropriate interest rate throughout this problem. Round all values to whole numbers Flag question: Question 6 Question 64.5 pts What are the funds available after the Nail Salon? Group of answer choices $100,000 $105,000 $72,000 $98,500 Flag question: Question 7 Question 74.5…
- Nathan and Stephanie are saving for their daughter's college education. Their daughter, Paige, is now 8 years old and will be entering college 10 years from now (t = 10). College tuition and expenses at State U. are currently $16,000 a year and are expected to increase at a rate of 4% a year. They expect Paige to graduate in 4 years (if Paige wants to go to graduate school, she's on her own). Tuition and other costs will be due at the beginning of each school year (at t = 10, 11, 12, and 13). So far, Nathan and Stephanie have built up $9,000 in the college savings account. Their long-run financial plan is to contribute $3,000 a year at the beginning of each of the next five years (at t = 0, 1, 2, 3, and 4). Then they plan to make 6 equal annual contributions at the end of each of the following 6 years (t = 5, 6, 7, 8, 9, and 10). Their investment account is expected to earn 8%. How large must the annual payments be in the subsequent 6 years (t = 5, 6, 7, 8, 9, and 10) to meet their…Your client has asked you what would be needed to fund your 2 children’s future college costs. Assume each child will begin college at age 18 and graduate in four years. Jamie is currently 14 years old and Johnny is currently 9 years old. Assume current costs are $24,000 per year and are expected to increase by 5% per year and investments earn 7%. Assuming no existing assets are dedicated to college, what is the annual savings required to fund the children’s education? Please include your calculator keystroke input for each step of this calculation.Philip works at a nursing home as an aide and earns $27,000 a year. IF he went to school to get a nursing degree he could earn $50,000 in the first year. Philip knows this but he also knows that tuition and fees at a nearby college could cost about $45,000(total). He can get a student loan for 5% with 10 years to repay the loan. What is the total cost of the student loans?
- The cost of tuition at the college that Lacy wants to attend is $12,500 per year. Lacy’s family will pay 70% of the tuition cost each year. Lacy has two years to save enough money to attend her first year of college. What is the minimum amount that she should save each month in order to have enough money to attend her first year of college? $156.25 $729.17 $3,750.00 $312.50Your parents have accumulated a $130,000 nest egg. They have been planning to use this money to pay college costs to be incurred by you and your sister, Courtney. However, Courtney has decided to forgo college and start a nail salon. Your parents are giving Courtney $22,000 to help her get started, and they have decided to take year- end vacations costing $9,000 per year for the next four years. Use 6 percent as the appropriate interest rate throughout this problem. Use Appendix A and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods. a. How much money will your parents have at the end of four years to help you with graduate school, which you will start then? Note: Do not round intermediate calculations. Round your final answer to 2 decimal places. Funds available for graduate school b. You plan to work on a master's and perhaps a PhD. If graduate school costs $24,580 per year, approximately how long will you be…The Jeffersons have asked you what would be needed to fund the children’s future college costs. Assume each child will begin college at age 18 and graduate in four years. Assume current costs are $24,000 per year and are expected to increase by 5% per year and investments earn 7%. A. Assuming no existing assets are dedicated to college, what is the annual savings amount required to fund the children’s education? The Jeffersons’ goal is to have an amount at the beginning of the freshman year for each child that is sufficient to fund a serial payment covering the $24,000 of current costs of college adjusted for inflation for each of the four years of college. Please include your calculator keystroke inputs [PV, I/YR, N, FV, and PMT (if needed)] for each step of this calculation. Also include whether any PMTs are in the end mode or the begin mode. B. What would you say to the Jeffersons about their education funding situation? Write a script of a single paragraph as if you…