David Jones wants to save for his child's college tuition in 20 years, how much money should he build into his tuition account at the end of each year in order to be able to withdraw 110,000/year for 4 years. Assuming a 4% interest rate before the child goes to college and a 5% interest rate after the child goes to college, calculate yearly contribution to David Jones.
David Jones wants to save for his child's college tuition in 20 years, how much money should he build into his tuition account at the end of each year in order to be able to withdraw 110,000/year for 4 years. Assuming a 4% interest rate before the child goes to college and a 5% interest rate after the child goes to college, calculate yearly contribution to David Jones.
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
Chapter27: Time Value Of Money (compound)
Section: Chapter Questions
Problem 6E
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If David Jones wants to save for his child's college tuition in 20 years, how much money should he build into his tuition account at the end of each year in order to be able to withdraw 110,000/year for 4 years. Assuming a 4% interest rate before the child goes to college and a 5% interest rate after the child goes to college, calculate yearly contribution to David Jones.
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