A generous alum would like to establish an endowment that would sponsor a student organization's conferences in perpetuity. A one-time cost of $500,000 must be paid today to purchase supplies for the conference. The conference is held once every four years and costs $90,000 . The first conference will take place at the end of year 4 . The alum's gift is invested in an account that earns 4% annually. How much would the alum need to place in the endowment to be able to sponsor the student organization's conferences? [Enter your answer with no dollar sign or comma.]
A generous alum would like to establish an endowment that would sponsor a student organization's conferences in perpetuity. A one-time cost of $500,000 must be paid today to purchase supplies for the conference. The conference is held once every four years and costs $90,000 . The first conference will take place at the end of year 4 . The alum's gift is invested in an account that earns 4% annually. How much would the alum need to place in the endowment to be able to sponsor the student organization's conferences? [Enter your answer with no dollar sign or comma.]
Chapter5: Gross Income: Exclusions
Section: Chapter Questions
Problem 52P
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A generous alum would like to establish an endowment that would sponsor a student organization's conferences in perpetuity. A one-time cost of
$500,000
must be paid today to purchase supplies for the conference. The conference is held once every four years and costs
$90,000
. The first conference will take place at the end of year 4 . The alum's gift is invested in an account that earns
4%
annually. How much would the alum need to place in the endowment to be able to sponsor the student organization's conferences? [Enter your answer with no dollar sign or comma.]
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