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Q1. After 18 years, how much money will we have for the university education for our...

Q1.

After 18 years, how much money will we have for the university education for our 3 children? If we invest in the given below option:

Current savings = $20,000

semi-monthly contribution of $150 at the end of each period, set aside for the next 18 years = $150 (semi-monthly contribution)

average annual rate of return compounded semi-monthly = 8%

Please use (display + name) the excel function/ formula for all questions

1. University education savings plan

APR

8.00%

period rate

semi-monthly contributions

-$150.00

#periods

Amount available after 18 years:

Ques 2. We have 3 children. Our objective is to give each child $25,000 at the beginning of each year of their engineering college ($75,000 in total per year) for 4 years. How much money would we need to have available in our university education savings fund 18 years from now based on an annual interest rate of 8%? (Also compounded semi-monthly).

Please use (display + name) the excel function/ formula for all questions

2. money needed in fund

period rate

payments

-$75,000.00

#periods

Amount needed 18 years from now:

Ques 3. If our semi-monthly contribution of $150 is not enough to meet our target, how much would we have to contribute to the university savings fund on a semi-monthly basis? (to have the required amount needed when children start college).

Please use (display + name) the excel function/ formula for all questions

3. required contribution

period rate

#periods

Required semi-monthly contribution:
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