You are saving for the graduation (4 years) of your two children. They are two years apart in age; one will begin university in 15 years from today, the other will begin in 17 years from today. You estimate your children’s university expenses to be $21,000 per year per child. The annual interest rate is 15 percent. How much money must you deposit in an account each year to fund your children’s education? You will begin payments one year from today. You will make your last deposit when your oldest child enters university.
You are saving for the graduation (4 years) of your two children. They are two years apart in age; one will begin university in 15 years from today, the other will begin in 17 years from today. You estimate your children’s university expenses to be $21,000 per year per child. The annual interest rate is 15 percent. How much money must you deposit in an account each year to fund your children’s education? You will begin payments one year from today. You will make your last deposit when your oldest child enters university.
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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You are saving for the graduation (4 years) of your two children. They are two years apart
in age; one will begin university in 15 years from today, the other will begin in 17 years
from today. You estimate your children’s university expenses to be $21,000 per year per
child. The annual interest rate is 15 percent. How much money must you deposit in an
account each year to fund your children’s education? You will begin payments one year
from today. You will make your last deposit when your oldest child enters university.
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