Withdraw from the fund to purchase car

Assignment Help Financial Management

Reference no: EM132033945

John’s parents started a college fund earning 8% (compounded annually) on the day he was born in1990 (time 0, when John was born). They deposited $1,500 on his birthday each year until he turned 5, after that they began depositing $4,000 annually until he turned 18. When he was 16 he wanted to buy a car. Knowing that John’s college fund would need a balance of at least $100,000 when he started college, at the age of 18, how much did John’s parents allow him to withdraw from the fund to purchase his car?

Reference no: EM132033945

Questions Cloud

Considering to refinance her mortgage : Suppose your friend April is considering to refinance her mortgage. How much should her monthly payment be under each option?

The interest rate on the loan with the compensating balance : How low would the interest rate on the loan with the compensating balance have to be for you to choose it?

Make each year to break even on the cost of the hoe : How much did “We Dig It” have to make each year to break even on the cost of the hoe?

How much would the company afn be reduced : Sales are expected to grow by 14% next year and the CFO wants to lower the DSO to the industry average of 42 days.

Withdraw from the fund to purchase car : how much did John’s parents allow him to withdraw from the fund to purchase his car?

Interest rate implied by spot and futures prices of bonds : What is the 1-year interest rate implied by the spot and futures prices of bonds? What hedging strategy would you recommend to him?

What should management do to recuse the cost of capital : What should management do to recuse the cost of capital? Why would that be successful?

Statements is true about the efficient market hypothesis : Which of the following statements is true about the efficient market hypothesis?

Net income to the controlling and noncontrolling interests : determine the proper allocation of consolidated net income to the controlling and noncontrolling interests?

User Account

All Pages