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.

Q: Joe wants to have $50,000 ten years from now to use for a down payment on a house. How much should…

A: Given: Future value = $50,000 Interest rate = 4.5% Years =10

Q: Willie deposits a fixed monthly amount into an annuity account for his child’s college fund. He…

A: Here, to calculate the monthly contribution we have to use the formula of future value of annuity.…

Q: Jim has an annual income of $300,000. Jim is looking to buy a house with monthly property taxes of…

A: Here, To Find: Maximum monthly mortgage payment =?

Q: A couple plans to save for their child's college education. What principal must be deposited by the…

A: Time value of money: The value of money changes with time. It is the concept that worth of a dollar…

Q: Palma wants to establish a fund for her granddaughter's college education. What lump sum must she…

A: Computation:

Q: You annually invest $1,500 in an individual retirement account (IRA) starting at the age of 25 and…

A: Your annual investment, PMT = $ 1,500    Starting age = 25Number of Years, n = 15Annual Interest…

Q: Assume the total cost of a college education will be $525,000 when your infant child enters college…

A: When the borrower borrows a loan from the lender, he has to pay a rate of interest on the borrowed…

Q: On a child's first birthday, a parent wishes to deposit enough money so that the child can withdraw…

A: Present Value of annuity = Annual payments * PVAF(rate, number of years) Present Value = Future…

Q: Two parents plan to pay their child's college tuition starting 17 years from now. The college…

A: Number of years to college = 17Current cost = $11,000Annual growth rate = 6%Annual interest rate =…

Q: A client's child will be attending college in 7 years. Assume current tuition and fees are $37, 294,…

A: Current tuition fees = $37,294Rate of return (r) = 9.94% or 0.0994Inflation rate = 1.96% or…

Q: ou are saving for the college education of your two children. They are two years apart in age; one…

A: Present value is the equivalent today of the future money required based on time and interest rate…

Q: Sarah wants to save $20,000 to use for a down payment on a home. She deposits some money into a…

A: Individuals can save for expenditure by investing in financial instruments in which money grows at a…

Q: Maria wants to attend Clarke University. She will need $90,000 eight years from today. Assume…

A: Amount required (FV) = $90,000 Semiannual interest rate (r) = 0.03 (i.e. 0.06 / 2) Semiannual period…

Q: Pete Morton is planning to go to graduate school in a program of study that will take three years.…

A: The Present Value of Ordinary Annuity refers to the concept which gives out the discounted or…

Q: You have recently adopted a child and are planning to save for her college education. You want to…

A: We need to use future value of ordinary annuity formula to calculate annual payment to achieve…

Q: If your daughter is 5 and she plans to go to college or university in Canada when she is 18 years…

A: Present Value is the current value of all the cash flows which is to be received in the future which…

Q: A 40-year-old woman decides to put funds into a retirement plan. She can save $1,000 a year and earn…

A: We need to calculate the persent value of annuity  by using this formula.    PV of annuity =CF*…

Q: The Mellows have decided to invest in a college fund for their young son. They invested $30,000 in a…

A: Rate The interest rateNper  The total number of payments Pmt Payment per periodPv  The present…

Q: Assume the total cost of a college education will be $365.000 when your child enters college in 18…

A: given, future value = $356,000 present value = $59,000 n = 18 years

Q: Madison is planning to save for his newborn daughter’s college tuition, to be paid in 18 years. The…

A: The concept of time value of money will be used here. As per the concept of time value of money the…

Q: You annually invest $2,000 in an individual retirement account (IRA) starting at the age of 30 and…

A: Since, in this question fixed amount is invested each year. So, it is the question of annuity.…