Your daughter is 8 years old today. You are worried about paying for her college tuition, which you estimate will be $20,000 per year (after scholarships). You decide to start a college savings fund by depositing an equal amount in the bank at the end of each of the next 10 years. At the end of years 11, 12, 13 and 14, you want to withdraw $20,000 in order to pay for the tuition. An interest rate of 8% APR compounded annually is assumed. How much do you have to deposit at the end of each of the next 10 years in order to pay for the tuition costs?

Your daughter needs to be able to draw $50,000 a year from her college savings fund (you started from birth) to pay for college expenses to obtain a medical degree (assume she spends 4 years for bachelor, 4 years for med school, then additional 2 years as resident and yearly spending will be consistent from year to year). At start of her college career, she intends to invest her savings in government securities that should return 5.5% a year compuounded continuously. a. Obtain the equation for dP/dt and then find the genearl solution of P(t) with, as yet undetermined, initial value P_0. b. How large must your daughter's initial college savings be so that she can continue drawing her $50,000 income until she becomes a doctor?

The parents of a newborn decide to make deposits into an educational savingsaccount on each of their daughter's birthdays, starting with her first birthday.Assume that the educational savings account will return a constant 5.5% per year.The parents plan to deposit $2 200 on every of their daughter's future birthdays.How much money could they alternatively deposit on their daughter's birth date(today) to have the same amount available on her 18th birthday?

A) When Liam Corbett was born, his grandparents opened a 529 college savings plan for him so that he had enough money to pay for college once he turned 18. His college education is expected to cost $225,000 on the day he turns 18 years old. Determine if there will be enough in the account given the following assumptions (Show your calculations): Assumption #1: The grandparents contribute $6,200 per year starting the day Liam is born and the account earns an average annual rate of return of 7%. Assumption # 2: The grandparents contribute $5,000 per year starting the day Liam is born and the account earns an average annual rate of return of 7%. Assumption # 3: The grandparents contribute $5,000 per year starting the day Liam is born and the account earns an average annual rate of return of 9%. Assumption #4: The grandparents contribute $8,500 per year starting the day Liam is born and the account earns an average annual rate of return of 4%. Assumption # 5: The grandparents contribute…

In 9 years, David's child will go to university. David already has $5,800 set aside in the savings account but plans to contribute an additional $900 at the end of each year to this account for his children's education. He anticipates earning an annual return rate of 5% on his savings throughout that time (compounded annually). When his kid is ready to register for university, how much money will David have in this account? (Round time value factors to 3 decimal places and final answer to 2 decimal places. Omit the "$" sign in your response.)

Suppose that your parents are willing to lend you $20,000 for part of the cost of your college education and living expenses. They want you to repay them the $20,000, without any interest, in a lump sum 15 years after you graduate, when they plan to retire and move. Meanwhile, you will be busy repaying federally guaranteed loans for the first 10 years after graduation. But you realize that you won’t be able to repay the lump sum without saving up. So you decide that you will put aside money in an interest-bearing account every month for the five years before the payment is due. You feel comfortable with putting aside $275 a month (the amount of the payment on your college loans, which will be paid off after 10 years). How high an annual nominal interest rate on savings do you need to accumulate the $20,000 in 60 months, if interest is compounded monthly? Enter into a spreadsheet the values d 5 275, r 5 0.05 (annual rate), and n 5 60, and the savings formula with r replaced by r/12 (the…

Your daughter is currently 9 years old. You anticipate that she will be going to college in 9 years. You would like to have $107,000 in a savings account to fund her education at that time. If the account promises to pay a fixed interest rate of 12% per year, how much money do you need to put into the account today to ensure that you will have $107,000 in 9 years? Your deposit today should be $ (Round to the nearest dollar.)

To complete your last year in business school and then go through law school, you will need $5,000 per year for 4 years, starting next year (that is, you will need to withdraw the first $5,000 one year from today). Your uncle offers to put you through school, and he will deposit in a bank paying 8.5% interest a sum of money that is sufficient to provide the four payments of $5,000 each. His deposit will be made today. Do not round intermediate calculations. Round your answers to the nearest cent. If your answer is zero, enter "0". How large must the deposit be? $   How much will be in the account immediately after you make the first withdrawal? After the last withdrawal? After the first withdrawal: $   After the last withdrawal: $

Your son Tommy was just born today (Year O), and you are planning for his college education. You would like to make equal deposits every 26 weeks (assume a 52-week year) into a college savings account starting in Year 1 and ending in Year 21 (a total of 41 deposits), so that Tommy can make annual withdrawals in Year 18, 19, 20, and 21 for tuition. Tuition is currently (Year 0) $2,900/year, and it is expected to grow at 4% / year for each of the next 10 years, and then at 5%/year for all years after. You can earn a nominal annual rate of 8.45%, with interest compounded weekly (52-week year) in a college savings account. How much must each of the 41 deposits be to exactly fund the expected tuition expense? O $277.87 O $264.49 O $258.02 O $248.10 O $287.80

Suppose that you need $30,000 for your last year of college. You could go to a private lending institution and apply for a signature student loan; rates range from 7% to 14%. However, your Aunt Sally is willing to loan you the money from her retirement savings, with no repayment until after graduation. All she asks is that in the meantime you pay her each month the amount of interest that she would otherwise get on her savings (since she needs that to live on), which is 4%.What is your monthly payment to her, and how much interest will you pay her over the year (9 months)?(Fill in the blanks below and give your answers as whole numbers.)The amount of interest per month you would pay Aunt Sally is $__(1)__ .The total interest you will pay her over the year (9 months)is $__(2)__ .