Compounded annually to cover daughter expenses

Assignment Help Financial Management

Reference no: EM131953171

Jack wants to figure out how much to save for his daughter’s 4-year college education. She will begin college in 10 years and Jack wants her to attend his alma mater, Auburn University. Currently, Auburn costs approximately $8,000 per year for a 15-hour course load. Given inflation and typical tuition increases, Jack expects these costs to rise at a rate of 2.5% per year. How much does Jack need to save at the end of each year into an account that pays 5% compounded annually to cover his daughter’s expenses? Payments are due at the beginning of each academic year.

Reference no: EM131953171

Questions Cloud

Discuss about the retention of employees : What other situations or problems specific to the human resource dept lend themselves to simple and multiple linear regression.

Calculating the number of periods using given information : Calculating the Number of Periods. You're trying to save to buy a new dollar 150,000 Ferrari. You have dollar 35,000 today that can be invested at your bank.

Contribute each year to fund your retirement : How much do you need to contribute each year to fund your retirement?

Which of the given investments has the higher return : Calculating Rates of Return You're trying to choose between two different investments, both of which have up-front costs of $70,000.

Compounded annually to cover daughter expenses : How much does Jack need to save at the end of each year into an account that pays 5% compounded annually to cover his daughter’s expenses?

What is the present value of your windfall : Calculating Present Values. You have just received notification that you have won the $2 million first prize in the Centennial Lottery.

Why dollar today is worth more than dollar in future : Why a dollar today is worth more than a dollar in the future. What does this have to do with health care costs?

Use her account rather than buying his own account : Under which of the following fees would Victor pay Amy and use her account rather than buying his own account?

The cost and possible solution for the agency problem : Which of the following statements correctly identifies the cost and possible solution for the agency problem in this? case?

User Account

All Pages