How much should he save each month

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Reference no: EM131913269

1. Zach wants to help pay for his kid's college. Assume he wants to pay for 75% of tuition through college. His kid will be going to college in 12 years. He will be help paying for his kid's undergraduate degree, which is expected to take him 4 years. There is a tuition growth rate of 5% and Zach has a rate of return of 7%. If the current tuition cost is $24,000 a year, how much should he save each month?

$549.06

$521.14

$556.28

$559.52

2. Rachel would like to pay for her daughter, Samantha, to go to college. Samantha will be graduating high school in 5 years and going to college. Rachel has a rate of return of 12%. Assume the that current tuition rates are $30,000 per year and there is an expected tuition growth rate of 7%. What is the lump-sum needed when Rachel begins school? Assume Rachel will pay 100% of the costs for four years and round your final answer to two decimal places.

$143,137.33

$152,498.72

$150,342.06

$157,367.39

Reference no: EM131913269

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