The size of each annual payment to their savings account

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Reference no: EM131854511

A family plans to send their child to college 12 years from now. They anticipate having to make 4 equal annual tuition payments in the amount of 20 thousand each, starting at the end of year 12.

They plan to put aside equal annual amounts into an investment account starting immediately, and continuing these contributions until one year before end of year 12. If they expect to earn 8% per year in the account, what must be the size of each annual payment to their savings account??

Reference no: EM131854511

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