Question
A newborn baby receives $2,000 on her birthday from her parents which is deposited into an account and invested in the Vanguard S&P 500 Index
A newborn baby receives $2,000 on her birthday from her parents which is deposited into an account and invested in the Vanguard S&P 500 Index Fund.That is $2,000 deposited at t=0.
Assume that on every subsequent birthday up to and including her 16th birthday, the baby's parents deposit an additional $1,000 into the same account and invest the money in the Vanguard S&P 500 Index Fund.That is $1,000 deposited on each of t=1through t=16.There are no more contributions.
Assume the investments in the Vanguard S&P 500 Index Fund grow at 6% every year after all taxes and expenses. What will be the balance in the account at the baby's 65th birthday, rounded to whole dollars?
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Financial Management Principles and Application
Authors: Arthur J. Keown, J. William Petty, David F. Scott, Jr.
10th edition
536514119, 536514110, 978-0536514110
