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What is the total amount of annual scholarships

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Reference no: EM133188516

Question - Adam, won $17 million in a lottery.

a) If Adam decided to invest the entire $17 million to fund scholarships at his Alma Mater forever, how much could he provide annually if the interest rate on the investment was 5% (compounded annually) and scholarships are paid at the beginning of the year?

b) If Adam could invest the funds at 5% compounded quarterly, what is the total amount of annual scholarships that could be provided at the beginning of each year?

c) If Adam instead invested the funds for 2 years at 5% compounded quarterly, then established the scholarship fund, what is the total amount of annual scholarships that could be provided beginning in 2 years?

Reference no: EM133188516

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