Scholarship fund by making annual savings donations

Assignment Help Financial Management

Reference no: EM131020307

April wants to create a scholarship fund by making annual savings donations to the fund for several years before the fund starts making annual scholarship payments forever. She plans to save 22,900 dollars per year in the trust fund for 5 years. Her first savings donation to the trust fund is expected later today. How much can the trust fund be expected to provide each year for scholarships if the fund is expected to earn 5.89 percent per year, make equal, fixed scholarship payments forever, and make its first scholarship payment in 6 years from today?

Reference no: EM131020307

Questions Cloud

What is the return on investment for investors : In 1970, Walmart offered 300,000 shares of its common stock to the public at a price of $16.50 per share. Since that time, walmart has had 11 two for one stock splits. What is the return on investment for investors who purchased the stock in 1970 (ov..

Are quota system designed to redress past injustices ethical : Do firms have a moral obligation to hire more women to achieve demographic equality? Are quota systems designed to redress past injustices ethical

Automates and improves the interview process : You have been assigned to build a new system that automates and improves the interview process for the Human Resources Department of your organization. Your task is to develop a requirements definition for the new system. Include both functional and ..

Scenarios is an example of weak internal control : Which of the following scenarios is an example of weak internal control? The mailroom clerk authorizes credit memos The accounts receivable clerk prepares customer statements every month The warehouse clerk obtains a signature before releasing goods ..

Scholarship fund by making annual savings donations : April wants to create a scholarship fund by making annual savings donations to the fund for several years before the fund starts making annual scholarship payments forever. She plans to save 22,900 dollars per year in the trust fund for 5 years. make..

Retirement account-expect to have in account when he retires : Fei has 11,600 dollars in his retirement account. In addition, he plans to save 8,100 dollars per year in his account for 8 years. His first contribution to his account is expected immediately and his last contribution is expected in 7 years. Fei exp..

What is the firms net float : On an average day, a company writes checks totaling $1,500. These checks take 7 days to clear. The company receives checks totaling $1,800. These checks take 4 days to clear. The cost of debt is 9%. What is the firm's net float? A. $-3,300 B. $-300 C..

Immediate receipt of principal plus premium produces : A bond with a put option: (1) Is attractive because the immediate receipt of principal plus premium produces a high return. (2) Is more likely to be puttable when the yields to maturity are higher than coupon rates. (3)Will usually have a higher yiel..

Concerned about bank cash and net float : A financial manager should be concerned about bank cash and net float, which is the sum of: A. collection and book cash. B. collection float and disbursement float. C. disbursement float and book cash. D. disbursement float and bank credit. E. None o..

User Account

All Pages