Question
Cara has wonderful parents, who established a college savings plan for her when she was born. They deposited $500 into the account on the last
Cara has wonderful parents, who established a college savings plan for her when she was born. They deposited $500 into the account on the last day of each calendar year. The account has been earning 10%, compounded yearly. Now, Cara turned 18 and is about to resume her 4-year undergraduate degree at a prestigious university. What equal amount can Cara withdraw, beginning today, which falls on her 18th birthday, and each of the next 3 years to spend on her education? Assume that the account now earns 7% annually. Round your answer to the nearest dollar.
Select one:
a. $6,291
b. $8,285
c. $9,486
d. $8,865
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