Feeling very generous toward your alma mater because of the fine ed- ucation you received there, you decide to fund a scholarship to help future students with the cost of their education. You want this schol- arship to cover the annual cost of tuition for one student each year, and you want the scholarship to last forever. To adequately prepare for the administration of the scholarship, the university will begin awarding it starting in three years. Tuition this year for one student is $19,000, and is expected to stay constant in real terms into perpetuity. If this scholarship fund is to be invested to earn an annual real return. of 5 percent, how much must you contribute to the fund today?

AppendixLO1