Question
A couple plans to pay their childs college tuition for 4 years starting 18 years from now. The current annual cost of college is C$7,000,
A couple plans to pay their childs college tuition for 4 years starting 18 years from now. The current annual cost of college is C$7,000, and they expect this cost to rise at an annual rate of 5 percent. In their planning, they assume that they can earn 6 percent annually.
How much must they put aside each year, starting next year, if they plan to make 17 equal payments?
im using BA2 plus(cfa) calculator to do it.
1.BGN mode, N=4 I/Y=5 PMT=-7000 FV=0 CPT PV=26062.74 to calculate total money for tuition
2.END mode, N=17 I/Y=6 PV=0 FV=26062.74 CPT PMT=-923.78
they need to put 923.78 each year is what i got.
Pls help, i know it is not right, and i dont know which step is wrong pls help!!!!
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