A father wants to save in advance for his 8-year-old daughter's college expenses. The daughter will enter the college 10 years from now. An annual amount of R20,000 in today's rands will be required to support the college for 4 years. Assume that these college payments will be made at the beginning of the school year. The future general interest rate on the savings account will be 8% per annum during this period. What is the equal amount the father must save at the end of each year until his daughter goes to college?
A father wants to save in advance for his 8-year-old daughter's college expenses. The daughter will enter the college 10 years from now. An annual amount of R20,000 in today's rands will be required to support the college for 4 years. Assume that these college payments will be made at the beginning of the school year. The future general interest rate on the savings account will be 8% per annum during this period. What is the equal amount the father must save at the end of each year until his daughter goes to college?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A father wants to save in advance for his 8-year-old daughter's college expenses. The daughter will enter the college 10 years from now. An annual amount of R20,000 in today's rands will be required to support the college for 4 years. Assume that these college payments will be made at the beginning of the school year. The future general interest rate on the savings account will be 8% per annum during this period.
What is the equal amount the father must save at the end of each year until his daughter goes to college?
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