You wish to set up an endowment at Cox School of Business for a scholarship of...

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You wish to set up an endowment at Cox School of Business for a scholarship of $8982 per year for the next 14 years. If the current rate of return that the endowment can expect to earn is 8.52% per year. You realize that every year there is loss of value due to inflation and want to increase the scholarship offer by 3.68% to account for this. If the scholarship increases by 3.68% every year for this time period, how much do you have to contribute today? You wish to set up an endowment at Cox School of Business for a scholarship of $8982 per year for the next 14 years. If the current rate of return that the endowment can expect to earn is 8.52% per year. You realize that every year there is loss of value due to inflation and want to increase the scholarship offer by 3.68% to account for this. If the scholarship increases by 3.68% every year for this time period, how much do you have to contribute today?

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To calculate the amount you need to contribute today to set up the endowment taking into account the ... View the full answer