Set up a fellowship fund for carleton university

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In 30 years, you plan to set up a fellowship fund for Carleton University that would pay out $100,000 a year in perpetuity with an annually compounded discount rate of 5%. In order to set up the fund in 30 years, how much do you need to save each year (starting this year) assuming rate of return on your savings is 10% per annum compounded semi-annually for the next 30 years? NB: for the second part, convert the annual percentage rate of 10% compounded semi-annually to EAR and use the EAR as the discount rate.

Reference no: EM132386357

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