10)

You want to have $50,000 in 12 years to put toward your daughter's education. You just received a large inheritance and want to know how much of it to put away today so that you can have the $50,000 in 12 years.

Assume you can earn 4% (compounded annually).

a) What do you need to put away today to achieve your goal?

b) What interest in dollars would you have earned in total?

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