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Quiz: Sample Exam – Traditional Exam 1
Assume that you are planning for your child’s education. You would like to make deposits every 26 weeks (half year) in Years 0 through 21, with your first deposit to be made today (a total of 43 deposits), so that your child may make withdrawals in each of the Years 18 through 21 for tuition. Tuition is currently $3,000, but is expected to grow at 4% for each of the next 10 years, then at 6% for each of years 11 through 25. If you can earn a stated or nominal annual rate of 8.476%, but interest is compounded weekly (52-week year), then how much must you deposit every 26 weeks?
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