A family wants to have a $150,000 college fund for their children at the end of 20 years. What contribution must be made at the end of each quarter if their investment pays 7.6%, compounded quarterly? (Round your answer to the nearest cent.)

Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
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A family wants to have a $150,000 college fund for their children at the end of 20 years. What contribution must be made at the end of each quarter if their investment pays 7.6%, compounded quarterly? (Round your answer to the nearest cent.)
$
Transcribed Image Text:A family wants to have a $150,000 college fund for their children at the end of 20 years. What contribution must be made at the end of each quarter if their investment pays 7.6%, compounded quarterly? (Round your answer to the nearest cent.) $
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Step 1

Given that future value  FV=$ 150,000 Interest rate r=7.6%=7.6100=0.076Compounded quarterly m=4 i=rm=0.0764=0.019Number of years t=20  years  Number of payments n=mt=4×20=80   .

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