Question
Doug wants to go on vacation to Disneyland with his family every 5 years. He figures that travel costs today are $3,000 for all expenses
Doug wants to go on vacation to Disneyland with his family every 5 years. He figures that travel costs today are $3,000 for all expenses associated with the trip, and he expects these costs to increase with inflation. Assume inflation is 2%, compound quarterly. He wants to take his family on their next Disneyland trip in exactly 5 years, and he wants to do these trips for the next 50 years. If he can earn 6.6% APR, compounded monthly, on his investments. How much would Doug need to invest today in order to pay for the next 50 years of Disneyland trips?
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