A professor has two daughters that he hopes will one day go to college. Currently, in-state students at the local University pay about $22,303 00 per year (all expenses included). Tuition will increase by 4 00% per year going forward. The professor's oldest daughter, Sam, will start college in 16 years, while his youngest daughter, Ellie, will begin in 18 years. The professor is saving for their college by putting money in a mutual fund that pays about 9.00% per year. Tuition payments are at the beginning of the year and college will take 4 years for each girl (Sam's first tuition payment will be in exactly 16 years) The professor has no illusion that the state lottery funded scholarship will still be around for his girls, so how much does he need to deposit each year in this mutual fund to successftully put each daughter through college (ASSUME that the money stays invested during college and the professor will make his last deposit in the account when Sam, the OLDEST daughter, starts college.) Submit Answer format: Currency Round to 2 decimal places.
A professor has two daughters that he hopes will one day go to college. Currently, in-state students at the local University pay about $22,303 00 per year (all expenses included). Tuition will increase by 4 00% per year going forward. The professor's oldest daughter, Sam, will start college in 16 years, while his youngest daughter, Ellie, will begin in 18 years. The professor is saving for their college by putting money in a mutual fund that pays about 9.00% per year. Tuition payments are at the beginning of the year and college will take 4 years for each girl (Sam's first tuition payment will be in exactly 16 years) The professor has no illusion that the state lottery funded scholarship will still be around for his girls, so how much does he need to deposit each year in this mutual fund to successftully put each daughter through college (ASSUME that the money stays invested during college and the professor will make his last deposit in the account when Sam, the OLDEST daughter, starts college.) Submit Answer format: Currency Round to 2 decimal places.
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 33P
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Transcribed Image Text:A professor has two daughters that he hopes will one day go to college. Currently, in-state students at the local University
pay about $22,303 00 per year (all expenses included). Tuition will increase by 4.00% per year going forward. The
professor's oldest daughter, Sam, will start college in 16 years, while his youngest daughter, Ellie, will begin in 18 years.
The professor is saving for their college by putting money in a mutual fund that pays about 9.00% per year. Tuition
payments are at the beginning of the year and college will take 4 years for each girl (Sam's first tuition payment will be in
exactly 16 years)
The professor has no illusion that the state lottery funded scholarship will still be around for his girls, so how much does
he need to deposit each year in this mutual fund to successfully put each daughter through college (ASSUME that the
money stays invested during college and the professor will make his last deposit in the account when Sam, the OLDEST
daughter, starts college.)
Submit
Answer format: Currency: Round to 2 decimal places.
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