# . Metro by T-Mobile LTE8:52 AM100%Spreadsheet helpful) Suppose that your parents arewilling to lend you \$20,000 for part of the cost of yourcollege education and living expenses. They want youthem the \$20,000, without any interest, in atorepaylump sum 15 years after you graduate, whenthey plan to retire and move. Meanwhile, you will bebusy repaying federally guaranteed loans for the first10 years after graduation. But you realize that youwon't be able to repay the lump sum without saving up.cide that you will put aside money inan interest-bearing account every month for the fiveyears before the payment is due. You feel comfortablewith putting aside \$275 a month (the amount of theSo youpayment on your college loans, which will be paid offafter 10 years)How high an annual nominal interest rate on savingsdo you need to accumulate the \$20,000 in60 months, if interest is compounded monthly? Enterinto a spreadsheet the values d 5 275, r 5 0.05 (annualrate), and n 5 60, and the savings formula with rreplaced by r/12 (the monthly interest rate). You willfind that the amount accumulated is not enough.Change r to 0.09; it's more than enough. Try othervalues until you determine r to two decimal places

Question
6 views

What is the interest rate, monthly deposits, time amount, target Amount, actual Amount and different? And what is the final answer to the question? I'm really lost right now. I was told to use the (saving formula for this)

check_circle

Step 1

Calculation of interest ...

### Want to see the full answer?

See Solution

#### Want to see this answer and more?

Solutions are written by subject experts who are available 24/7. Questions are typically answered within 1 hour.*

See Solution
*Response times may vary by subject and question.
Tagged in