Using the formula and financial calculator methods

Assignment Help Financial Management

Reference no: EM131896516

Your younger sister, Linda, will start college in five years. She has just informed your parents that she wants to go to Hampton University, which will cost $31,000 per year for four years (cost assumed to come at the end of each year). Anticipating Linda’s ambitions, your parents started investing $5,100 per year five years ago and will continue to do so for five more years. Use 9 percent as the appropriate interest rate throughout this problem (for discounting or compounding). How much will your parents have to save each year for the next five years in addition to the $5,100 they are currently saving to have the necessary funds for Linda's education? Use Appendix C and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Reference no: EM131896516

Questions Cloud

What is the level of operating cash flows each year : What is the level ($ amount) of operating cash flows each year if the project has a NPV of $10 million?

What is the after-tax cost of the preferred equity : What is the after-tax cost of the following preferred equity? The par value of the preferred share is $100 and the annual dividend is $7.00.

Holding small-company stocks are normally distributed : Assume the returns from holding small-company stocks are normally distributed.

Find the present value of the ordinary annuities : Find the present value of the following ordinary annuities. Find the present value of $500 due in future under each of following conditions.

Using the formula and financial calculator methods : calculate your final answer using the formula and financial calculator methods.

What is the after-tax cost of debt : What is the after-tax cost of debt. The after-tax cost of debt for Tiny Tots is __%.

Banks cause them to take excessive risks on the theory : Does bailing out large banks cause them to take excessive risks on the theory that they are “too big to fail”?

Appliances pays constant quarterly dividend : Anthony's Appliances pays a constant quarterly dividend of $.35 per share.

What is the share price of heavy metal : Referring to your answer for Q1, if Heavy Metal has 50 million shares outstanding (and no debt) what is the share price of Heavy Metal?

User Account

All Pages