Statement showing caculation of amount required in 2037 | ||
Particulars | Notes | $ |
Amount required for study as per servey of 2018-19(in $) | 1 | 37820 |
Inflation rate per year | 2 | 3.90% |
Year(Time period after which money reuired) | 3 | 18 |
cummulative inflation impact | 4 | 1.9910 |
Amount required for study in 2037 (in $)(1*4) | 5 | 75,301 |
Computation of savings per year | ||
Interest rate | 6 | 7.50% |
Year(Time period after which money reuired) | 7 | 18 |
present value factor for year1 | 8 | 0.9302 |
sum of present value factor (from year 1 to year 18) | 9 | 9.7060 |
(sum of pvf=1/(1+.075)^n) | ||
Solution A | ||
Amount required to save for getting required amount in 2037 | 7,758 | |
(75301/9.7060) i.e.(5/9) |
Solution B | |||||
Statement showing calculation of Real Amount Saving | |||||
Year | Saving(As per Solution A) | Inflation Index | Real Amount | Inflation Amount | Total Nominal Payment |
1 | 7,758 | 0.9625 | 7,466.99 | 291.21 | 7,758.20 |
2 | 7,758 | 0.9263 | 7,186.71 | 571.49 | 7,758.20 |
3 | 7,758 | 0.8916 | 6,916.95 | 841.26 | 7,758.20 |
4 | 7,758 | 0.8581 | 6,657.31 | 1,100.89 | 7,758.20 |
5 | 7,758 | 0.8259 | 6,407.42 | 1,350.78 | 7,758.20 |
6 | 7,758 | 0.7949 | 6,166.91 | 1,591.29 | 7,758.20 |
7 | 7,758 | 0.7651 | 5,935.43 | 1,822.77 | 7,758.20 |
8 | 7,758 | 0.7363 | 5,712.64 | 2,045.56 | 7,758.20 |
9 | 7,758 | 0.7087 | 5,498.21 | 2,259.99 | 7,758.20 |
10 | 7,758 | 0.6821 | 5,291.83 | 2,466.38 | 7,758.20 |
11 | 7,758 | 0.6565 | 5,093.19 | 2,665.01 | 7,758.20 |
12 | 7,758 | 0.6318 | 4,902.01 | 2,856.19 | 7,758.20 |
13 | 7,758 | 0.6081 | 4,718.01 | 3,040.19 | 7,758.20 |
14 | 7,758 | 0.5853 | 4,540.92 | 3,217.29 | 7,758.20 |
15 | 7,758 | 0.5633 | 4,370.47 | 3,387.73 | 7,758.20 |
16 | 7,758 | 0.5422 | 4,206.42 | 3,551.79 | 7,758.20 |
17 | 7,758 | 0.5218 | 4,048.52 | 3,709.68 | 7,758.20 |
18 | 7,758 | 0.5023 | 3,896.56 | 3,861.64 | 7,758.20 |
Total | 139,648 | 99,016 | 40,631 | 139,648 |
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