Question
A parent wants to create a college investment fund for his son who has just turned 8 years old. The father expects his son to
A parent wants to create a college investment fund for his son who has just turned 8 years old. The father expects his son to enter university in exactly 10 years, so he plans to deposit a fixed amount of magnitude D monthly from the end of the month (t = 1) and until his son finishes university within 168 months (ie 168 total deposits). Upon entering the university, the fund will be used to withdraw tuition and semester academic fees that are expected to total $ 325,000 (exactly 10 years from now, that is, the cost of the first semester for your child will be of this amount), and in the same way it is estimated that from that first semester, the total cost of the university will increase by 3% semester for the rest of the student's professional career. semesters, and the savings fund offers an investment rate of 0.75% effective monthly, determine the value of the monthly deposits (D) in such a way that at the end of his son's studies, the father can close his account with a null balance. Suppose the tuition payment occurs at the end of the college semester, for example, the first semester payment will occur within 21 semesters or 126 months, the second payment will occur within 22 semesters or 132 months, and so on until the payment is finished. of the eighth semester in semester 28 or exactly 168 months from now.
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