Consider the scholarship fund in the preceding question. Suppose that the first scholarship award occurs one year from now and the donor wants the scholarship to grow by 2% per year. How much should the donor deposit if the fund earns
a. 6% per period?
b. 8% per period?
Suppose that the first scholarship award occurs five years from now but is to grow at 2% per year alter the fifth year, the time of the first $3,000 award. How much should the donor deposit if the fund earns
c. 6% per year?
d. 8% per year?
Required:
Calculations of present and future value (or single payments and for annuities, to make the exercises more realistic, we do not give specific guidance with each individual exercise.