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trust for her today which will provide 16 payments throughout the next four years as well as the cost of a graduation trip when she completes college four years from now. They will withdraw an extra $5,000 on the same day as the last regular $2,500 withdrawal. If money is worth 6.1%, compounded quarterly, how much must be deposited now to provi

trust for her today which will provide 16 payments throughout the next four years as well as the cost of a graduation trip when she completes college four years from now. They will withdraw an extra $5,000 on the same day as the last regular $2,500 withdrawal. If money is worth 6.1%, compounded quarterly, how much must be deposited now to provi

Excel Applications for Accounting Principles
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
Chapter27: Time Value Of Money (compound)
Section: Chapter Questions
Problem 5E
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Juanita Domingo is starting college in three months. Her parents want to establish a college trust for her today which will provide 16 payments throughout the next four years as well as the cost of a graduation trip when she completes college four years from now. They want her to be able to make withdrawals of $2,500 at the end of every quarter for the next four years. Additionally, she will withdraw an extra $5,000 on the same day as the last regular $2,500 withdrawal. If money is worth 6.1%, compounded quarterly, how much must be deposited now to provide for this trust? (Round your answer to the nearest cent.) $
Transcribed Image Text:Juanita Domingo is starting college in three months. Her parents want to establish a college trust for her today which will provide 16 payments throughout the next four years as well as the cost of a graduation trip when she completes college four years from now. They want her to be able to make withdrawals of $2,500 at the end of every quarter for the next four years. Additionally, she will withdraw an extra $5,000 on the same day as the last regular $2,500 withdrawal. If money is worth 6.1%, compounded quarterly, how much must be deposited now to provide for this trust? (Round your answer to the nearest cent.) $
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