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In 2 0 2 4 , Dr . Chen s daughter is 8 years old, and Dr . Chen is planning for his daughter s
In Dr Chens daughter is years old, and Dr Chen is planning for his daughters college fund. He expects his daughter to start her college education at the age of which is years from now. The expected cost of tuition only for a year college education in is $$ per year at a public, instate university. The college fund is invested to gain investment returns. Dr Chen is considering two investment options. The first is a mutual fund that is expected to provide an annual return of per month The second is a bank deposit account that offers an annual return of per month Dr Chen decides to put a fixed amount of money every month into the college fund starting from January to January months times years months The interest is monthly compounded. With the mutual fund investment returns, if Dr Chen starts saving in January how much money does he need to put in every month to fully cover his daughters college tuition if he wants the account fully funded when she turns Hint: There are full years left for Dr Chen to save for his daughter. We assume Dr Chens daughter will do a fouryear college with a fixed annual tuition of $$ per year
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