Create schedule showing the cash inflows and outflows

Assignment Help Financial Management

Reference no: EM131513464

Karine and Arlo are trying to establish a University Fund for their daughter Amelia, who turns 3 today. They plan for Amelia to withdraw $11,000 on her 18^th birthday and $12,000, $13,000 and $15,000 on her subsequent birthdays (19^th, 20^th and 21^st). They wish to deposit money into an account so that, with interest it will build up enough to make the planned withdrawals. They wish to deposit using a 10-year annuity, and they intend to make their first deposit one year from today, and expect to earn an average return of 6.25%pa.

i. How much will Karine and Arlo have to contribute each year to the annuity to achieve their goal?

ii. Create a schedule showing the cash inflows (including interest) and outflows of this fund. How much will be in the fund on Amelia's 16^th birthday?

Reference no: EM131513464

Questions Cloud

Use the repayment plan as opposed to the lump sum : what interest rate are you being charged if you decide to use the repayment plan as opposed to the lump sum?

Firm to experience a constant rate of growth : rather than expecting the firm to experience a constant rate of growth, you expect the following variable growth pattern?

Discussions on branding as part of the marketing strategy : The information from our discussions on branding as part of the marketing strategy development phase of the process.

Evaluate the deflections : Computer analysis of a continuous beam. The continuous beam in Figure P5.56 is constructed from a W12 × 152 wide flange steel section with A = 44.7 in.2.

Create schedule showing the cash inflows and outflows : Create a schedule showing the cash inflows (including interest) and outflows of this fund.

Equity investment of this level of risk : How much are you willing to pay for one share of this stock if you want to earn 12.5 percent on an equity investment of this level of risk?

Determine the forces or components of force : Determine the forces or components of force in all bars of the trusses in Figures P4.50. Indicate tension or compression.

Create a workforce that will effectively move the newly : Create a workforce that will effectively move the newly formed company forward.Identify all of the information you would need to effectively manage.

Compute analysis of a truss with rigid joints : Computer analysis of a truss with rigid joints. The truss in Figure P4.55 is constructed of square steel tubes welded to form a structure with rigid joints.

User Account

All Pages