Linda is 10 years old. Her parents want to save for 4 years of college, starting at 18. Her parents want to deposit X today and on birthdays 11,12, …. 17. On birthdays 18, 19, 20, 21 they plan to take out $20,000 – the total cost of education. How much do her parents need to save each year? Assume the discount rate is 10%. Solve the following ways: Using trial and error, is the $4,000/per year enough? Using Goal Seek, solve for the annual deposit necessary to meet their financial goals.
Linda is 10 years old. Her parents want to save for 4 years of college, starting at 18. Her parents want to deposit X today and on birthdays 11,12, …. 17. On birthdays 18, 19, 20, 21 they plan to take out $20,000 – the total cost of education. How much do her parents need to save each year? Assume the discount rate is 10%. Solve the following ways: Using trial and error, is the $4,000/per year enough? Using Goal Seek, solve for the annual deposit necessary to meet their financial goals.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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- Linda is 10 years old. Her parents want to save for 4 years of college, starting at 18. Her parents want to deposit X today and on birthdays 11,12, …. 17. On birthdays 18, 19, 20, 21 they plan to take out $20,000 – the total cost of education. How much do her parents need to save each year? Assume the discount rate is 10%. Solve the following ways:
Using trial and error, is the $4,000/per year enough? - Using Goal Seek, solve for the annual deposit necessary to meet their financial goals.
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