5. You are the proud parent of a baby girl. Youlestimate that the cost of her college education 18 years from now will be about S100,000. In order to raise that money, how much should you pay semiannually into an account paying 7% compounded semiannually? (8)
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- b) You would like to give your daughter $75,000 towards her college education 17 years from now. How much money must you set aside today for this purpose if you can earn 8 percent on your investments? What should be the annual equal payments to achieve the same objective?You have saved $120,000 for your child to attend college. If it is in an account earning an annual rate of 6%, how much can you take out in equal payments at the end of each of the next four years to pay for their education? Answer: future value = $5,24,953.92Question: How much can you take out in equal payments at the beginning of each of the next four years to pay for their education?You are saving for the college education of your two children. They are two years apart in age; one will begin college 15 years from today and the other will begin 17 years from today. You estimate your children’s college expenses to be K23,000 per year per child, payable at the beginning of each school year. The annual interest rate is 6.5 percent. How much money must you deposit in an account each year to fund your children’s education? Your deposits begin one year from today. You will make your last deposit when your oldest child enters college. Assume four years of college.
- 6. If you desire to have $80,000 for a down payment for a house in 7 years, what amount would you need to deposit each year for these 7 years? Assume that your money will earn 10 percent per year. 7. Kate deposits $9,900 each yearinto her retirement account. If these funds have an average earning of 11 percent over the 40 years until her retirement, what will be the value of her retirement account?You have saved $120,000 for your child to attend college. If it is in an account earning an annual rate of 6%, how much can you take out in equal payments at the end of each of the next four years to pay for their education?Your parents start saving for your sister's college education. She will begin college at age 18 and will need $4,000 per year at the end of each of the next 4 years. They will make a deposit one year from today in an account which pays 6% compounded annually, and an identical deposit each year including the year she starts college. If a deposit of $1,987 will allow them to reach their goal, how old is your sister now?
- Assume the total cost of a college education will be $525,000 when your infant child enters college in 17 years. Your are fortunate in that your uncle has just given your child a $25,000 gift to start the college fund. How much do you have to invest at the end of each month in order to accumulate the required $525,000 at the end of 17 years if your monthly investments earn an annual interest rate of 3.5 percent, compounded monthly?6. Calculating Interest Rates. Assume the total cost of a college education will be $290,000 when your child enters çollege in 18 years. You presently have $35,000 to invest. What annual rate of interest must you earn on your investment to cover the cost of your child's college education?4. Assume the total cost of a college education will be $300,000 when your child enters college in 18 years. You presently have $65,000 to invest. What annual rate of interest must you earn on your investment to cover the cost of your child’s college education? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) Annual rate of interest %
- Assume the total cost of a college education will be $365.000 when your child enters college in 18 years. You presently have $59,000 to invest. What annual rate of interest must you earn on your investment to cover the cost of your child's college education?K Jack and Jill have just had their first child. If college is expected to cost $190,000 per year in 18 years, how much should the couple begin depositing annually at the end of the next 18 years to accumulate enough funds to pay 1 year of tuition 18 years frm now? Assume that they can earn a 6% annual rate of return on their investment. The amount that the couple should begin depositing annually at the end of each year is S This question: point(s) (Round to the nearest cent)Suppose you have a 1-year old daughter and you want to provide R81 000 in 19 years towards hercollege education. You currently have R2 000 to invest. What interest rate must you earn to havethe R81 000 when you need it?