16. Your brother, James, will Join University inseven years, for his higher education. Hisambition is to pursue medicine at theUniversity of Nairobi. The Cost of educationwill be Sh. 1.5 Million per year for fiveyears. Anticipating James's ambitions, yourparents started investing Sh. 100,000 per yearfive years ago and will continue to do so eachyear for the next seven years. How muchmore will your parents have to invest eachyear for the next seven years to have thenecessary funds for the education of yourbrother? Use 12 percent as the appropriateinterest rate throughout this problem(a) The cost assumed to come at theend of each year(b) The cost assumed to come at thebeginning of each year

Future value of annuity is the amount of deposit done and amount of interest accumulated over the…

Your brother, James, will Join University in seven years, for his higher education. His ambition is to pursue medicine at the University of Nairobi. The Cost of education will be Sh. 1.5 Million per year for five years. Anticipating James's ambitions, your parents started investing Sh 100 000 per year

Your brother, James, will Join University in seven years, for his higher education. His ambition is to pursue medicine at the University of Nairobi. The Cost of education will be Sh. 1.5 Million per year for five years. Anticipating James's ambitions, your parents started investing Sh 100 000 per year

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter27: Time Value Of Money (compound)

Section: Chapter Questions

Problem 6E

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Question

16. Your brother, James, will Join University in
seven years, for his higher education. His
ambition is to pursue medicine at the
University of Nairobi. The Cost of education
will be Sh. 1.5 Million per year for five
years. Anticipating James's ambitions, your
parents started investing Sh. 100,000 per year
five years ago and will continue to do so each
year for the next seven years. How much
more will your parents have to invest each
year for the next seven years to have the
necessary funds for the education of your
brother? Use 12 percent as the appropriate
interest rate throughout this problem
(a) The cost assumed to come at the
end of each year
(b) The cost assumed to come at the
beginning of each year

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Step 2: Calculation of formula required

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Step 4: Calculation of amount required for education

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Step 5: Calculation of amount accumulated

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Step 6: Calculation of additional amount needed

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Step 7: Calculation of additional deposit required

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