14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving...

Question

Question

14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving...

14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving today equal amounts per year for 15 years at 8%, how much will you need to save per year?

business finance

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

Ans $ 7365.91

P =	Periodic payments
r =	rate of interest
n =	no of years


Future Value of Annuity =	P ( (1 + r)ⁿ - 1 ) / r
200000 =	P* ((1 + 8%)^15 - 1) / (8%)
200000 =	27.1521139274784 * P
P =	200000 / 27.1521139274784
P =	7365.91

Add a comment

Answer 2

Similar Homework Help Questions

You decided to start saving for your child's college tuition. Your child will start college in...

You decided to start saving for your child's college tuition. Your child will start college in 25 years. There will be 4 annual tuition payments of $30,000 each. The first payment will be 25 years from now. You will start saving one year from now and will put aside the same amount at the end of every year for 25 years. How much do you have to save every year to have enough to pay the tuition payments. Your savings...
1. You are current saving for your son's college expenses (tuition, room/board). She is 10 years...

1. You are current saving for your son's college expenses (tuition, room/board). She is 10 years old and will begin college in 8 years. Set aside for her education you have a brokerage account with $10,000 fully invested in an equity index fund that is expected to earn 10% per year. Your plan is to send your son to a public school where the expenses are currently (at T = 0) $18,000 per year, however you expect the expenses to...
You are currently saving for your spouse's college expenses (tuition, room/board). She is 20 years old...

You are currently saving for your spouse's college expenses (tuition, room/board). She is 20 years old and will begin college in 8 years. Set aside for his education you have a brokerage account with $10,000 fully invested in an equity index fund that is expected to earn 10% per year. Your plan is to send your wife to a state school where the expenses are currently (at T = 0) $18,000 per year, however, you expect the expenses to grow...

You are saving for the college education of your two children. They are two years apart...

You are saving for the college education of your two children. They are two years apart in age; one will begin college 15 years from today and the other will begin 17 years from today. You estimate your children’s college expenses to be $40,000 per year per child, payable at the beginning of each school year. The annual interest rate is 7 percent. Your deposits begin one year from today. You will make your last deposit when your oldest child...
Saving for College: A Mini Case Your life is changing rapidly. You are still in your...

Saving for College: A Mini Case Your life is changing rapidly. You are still in your first semester of the MBA program at Cal Poly, and you have met some very nice people. But there are big changes on the horizon-your significant other is pregnant and the baby is due around the first week of July, 2019! Of course your little pride-and-joy is going to be cute AND smart. After much consultation, your significant other and you have decided that...
1) You have two children who will be going to college. The first child will begin...

1) You have two children who will be going to college. The first child will begin 17 years from today, and tuition will be $20,000, $21,000, $22,000 and $23,000 at t=17, 18, 19, and 20. The second will begin college 19 years from today, and tuition will be $22,000, $23,000, $24,000 and $25,000 at t=19, 20, 21, and 22. a) To fund your children’s tuition, you would like to make an equal annual deposit over the next 20 years (first...

You are saving for your child's college tuition. Starting from the birth, you deposit $500 into...

You are saving for your child's college tuition. Starting from the birth, you deposit $500 into an account at the beginning of each month. The account generates 0.5% per month. By the time your child is 18 years old, how much money would you have in the account (assuming there are 18*12=216 payments, i.e there is no payment on the day your child turns 18)?
Investing $13,000 for each of eight years in an annuity due with a 6% interest rate,...

Investing $13,000 for each of eight years in an annuity due with a 6% interest rate, the value at the end will be: ____________________________________________ Last year Blueridge Corporation's sales were $280 million. If sales grow at 10% per year, how large (in millions) will they be 5 years later? $14000(.10)=1400 How much would $200,000 due in 50 years be worth today if the discount rate were 7.5%? =PV(7.5%,,50,,-20000) =537.78426453 =$537.78 Five years ago, Glow Go Inc. earned $7.50 per share. Its earnings...
You have been accepted into college. The college guarantees that your tuition will not increase for...

You have been accepted into college. The college guarantees that your tuition will not increase for the four years you attend college. The first $ 10 comma 100 tuition payment is due in six months. After that, the same payment is due every six months until you have made a total of eight payments. The college offers a bank account that allows you to withdraw money every six months and has a fixed APR of 4.2 % (with semiannual compounding)...

You would like to have $200,000 in a college fund in 15 years how much do...

You would like to have $200,000 in a college fund in 15 years how much do you need today if you expect to earn 12% while you are investing to pay for your child's college

14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving...

Homework Answers

Add Answer to:
14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving...

Post as a guest

Earn Coins

You decided to start saving for your child's college tuition. Your child will start college in...

1. You are current saving for your son's college expenses (tuition, room/board). She is 10 years...

You are currently saving for your spouse's college expenses (tuition, room/board). She is 20 years old...

You are saving for the college education of your two children. They are two years apart...

Saving for College: A Mini Case Your life is changing rapidly. You are still in your...

1) You have two children who will be going to college. The first child will begin...

You are saving for your child's college tuition. Starting from the birth, you deposit $500 into...

Investing $13,000 for each of eight years in an annuity due with a 6% interest rate,...

You have been accepted into college. The college guarantees that your tuition will not increase for...

You would like to have $200,000 in a college fund in 15 years how much do...

14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving...

Homework Answers

Add Answer to: 14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving...

Post as a guest

Earn Coins

Add Answer to:
14. Your target is to have $200,000 for your daughter’s college tuition. If you begin saving...