is thinking of establishing a fund for his daughter’s college education. He wants his daughter to be able to withdraw P60,000from the fund on her 18th birthday, again on her 19th birthday, again on her 20th birthday, up to her 23rd birthday. If the fund earns interest at 12% per year compounded annually, how much should Jessie deposit at the end of each year, from the time his daughter reaches 5 years old up to her 17th birthday

Q: eremiah Wood wants to set up a fund to pay for his daughter's education. In order to pay her…

A: Amount needed in 4 years (CF1) = $25,000 Amount needed in 5 years (CF2) = $26900 Amount needed in 6…

Q: Alex has set up a sinking fund for his son's college education in 10 years. From now on, he can save…

A: The first part of the question is asking for the future value of an ordinary annuity. The formula…

Q: Carolyn is helping to save for her granddaughter’s college fund. It will probably take 18 years…

A: Future value required (FV) = $150,000 Interest rate (r) = 6% Number of annual payments (n) = 18…

Q: Soon-to-be proud parents of a new born baby are planning to establish a scholarship fund for their…

A: To calculate the lump sum amount we need to calculate the present value of all the future cash flows…

Q: Mia will retire 10 years from now and wants to establish a fund today that will pay $48,000 cash at…

A: Deposited amount refers to the amount which is kept aside for investing in a fund for receiving the…

Q: John wants to have $200,000 to send his brother to school. He sets up a 529 plan and wants to know…

A: The concept of time value of money will be used here. Note that 529 plans are college savings plan…

Q: Laura is saving for the college education of hertwochildren. They are two years apart in age; one…

A: As a first step let’s plot the cash flows on a time diagram.Please see the white board. In the table…

Q: Lucas is starting a college fund for his newborn daughter. He decides to invest $200 a month in an…

A: The future value is the amount that will be received at the end of a certain period. In simple…

Q: Jeremiah Wood wants to set up a fund to pay for his daughter's education. In order to pay her…

A: The lump sum payment today is calculated using the following present value equationWhere, CFi is the…

Q: Alice needs P 4,000 per year for four years to go to college. Her father invested P 5,000 in 7%…

A: Future value of an amount is calculated as: = Amount * (1+rate)^number of periods

Q: Millet wants to provide a ₱200,000 graduation gift for her daughter Mae who is now 16 years old. She…

A: Present value is the sum of money that must be invested in order to achieve a specific future goal.…

Q: Brittany's parents want their child to go to the same college that they did. After talking with the…

A: Working of the amount put down by the Brittany’s Parents is shown: Hence, the amount deposited will…

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: Your grandfather wants to establish a scholarship in his father’s name at a local university and has…

A: Perpetuity term refers to the cash flow for an indefinite period or forever. The present value of…

Q: ex has set up a sinking fund for his son's college education in 10 years. From now on, he can save…

A: Sinking funds are amount of deposit required for the future planning requirements needed in the…

Q: Isabel Lopez from Lewiston, Idaho, who is 19 years old, recently received an inheritance of $55,000…

A: The Certificate of Deposit is a savings instrument that provides a fixed rate of return to the…

Q: Ms. Ieda Silva plans to retire in 28 years and expects to live for 25 years after retirement. She is…

A: we can use discounting techniques to value the monthly deposits.

Q: Fatima recently set up a tax-deferred annuity to save for her retirement. She arranged to have BD…

A: Working Note # 1 : P= Payment per period = BD 110 R= Rate of interest per period =2%/12 =…

Q: Ji Hyun's generous grandfather invests $1,000 when she is born into an index fund that produces a 7%…

A: Calculation of money will be in account.

Q: Brenda Young desires to have $16,500 eight years from now for her daughter’s college fund. If she…

A: Data given: FV= $16500 n=8 years r=12% (compounded annually) Required: what amount should she…

Q: As soon as she graduated from college, Kay began planning for her retirement. Her plans were to…

A: Retirement fund refers to the portion of the income which is saved by an individual for the purpose…

Q: jesse recieved $5,000 from his grandmother when he turned 18. if he invests it at 5.5%(12), how much…

A: The question gives the following information:

Q: To save for her newborn son's college education, Lea Wilson will invest $16,000 at the beginning of…

A: Payment = p = $16,000Time = t = 12 YearsInterest Rate = r = 12%Payment Type = at the beginning

Q: In order to fund his son’s higher education, Abdullah decided to invest $1000 quarterly for 6 years…

A: Future value is the worth of the current amount in future specified date at given interest rate. The…

Q: Mia will retire 10 years from now and wants to establish a fund today that will pay $30,000 cash at…

A: We will first calculate the value of the annuity at January 1, year 11 and then discount it for a…

Q: When Xian was born, his father Brian deposited a sum of money for the college education of Xian.…

A: Present Value = Future Value x 11+in

Q: 9. pay the remaining of their inventory? A couple decides to save $5,000 per year for 18 years to…

A: Step 1:We have to calculate the future value of the yearly deposits after 18 years. The formula of…

Q: our grandfather wants to establish a scholarship in his father's name at a local university and has…

A: Perpetuity type of annuity pay the money forever and the present value of perpetuity depends on the…

Q: Carl is the beneficiary of a $28,000 trust fund set up for him by his grandparents. Under the terms…

A: Annuity = Present Value / PVA of $1

Q: The Calvarusos have decided to invest in a college fund for their young son. They invested $40,000…

A: Future value is the estimated value of current assets that is discounted at an assumed rate of…

Q: how much is the 3rd investment?

A: Monthly interest rate  1st deposit = 6.5%/12 ; time=11×12=132months 2nd deposit = 7.3%/12 ;…

Q: er wish to set up a trust fund for their n $2,700 at the end of every 6 months 6 months from now and…

A: The given problem can be solved using PV function in excel. PV function computes current balance in…

Q: When Steven was 5 years old (on his birthday), his grandmother decided to set up a trust account to…

A: The amount to be deposited today is the present value of amount to be received on 18th birthday.…

Q: A wealthy donor wants to establish a scholarship that pays an award of $1,000 in perpetuity at the…

A: Present value refers to the current valuation for a future sum. Investors determine the present…

Q: When Joe graduated from college at age 22, his grandparents established a trust fund and endowed it…

A: Future value is the value of annuity at the end of a defined period. This can be calculated by…

Q: lex wants to provide funding in the event of his death for his daughter Ellie, age 8, to attend four…

A: There is a need for financial planning for future requirements and if done can produce good results…

Q: one ecided that you will give Bob $15,000 per yE year for each of his last two years of colleE f…

A: First, We need to compute the total amount required when BOB leaves for school. This can be computed…

Q: Isabel Lopez, from Lewiston, Idaho, is age 19, and she recently received an inheritance of $50,000…

A: The future value function can be used for determining the future value of a present sum, or the…

Q: Frank is planning for the day when his child, Laura, will go to college. Laurahas just turned eight…

A: The question is based on the calculation concept of future value and present value of fund in form…

Q: Suzy wants to retire in 30 years. She expects to live 25 years after retirement. She prepares a…

A: There is need of planning for retirement and that must be based on time value of money and based on…

Q: Ann and Tom want to establish a fund for their grandson's college education. What lump sum must they…

A: To calculate the deposit amount we will use the present value formula as follows:   Deposit amount =…

Q: A man intends to save up money for his retirement so that he can withdraw equal sums of P18,000 for…

A: Present Value of  Ordinary Annuity refers to the concept which dictates the discounted value of a…