Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Input into the spreadsheet will include: 1. Current age (5 yrs - child just turned 5) of child. Cell A1 2. Current cost (S30,000 for

image text in transcribed
Input into the spreadsheet will include: 1. Current age (5 yrs - child just turned 5) of child. Cell A1 2. Current cost (S30,000 for a year) of college. Cell Bl 3, Percentage rate of increase (5%) in college expenses. Cl 4. Interest rate (nominal interest rate r = 12% compounded monthly) earned on money invested. DI Assume equal deposits will be made, and that the deposits began on the first birthday. Assume the last deposit will be made one year before the first withdrawal, and that there will be five end-of-year withdrawals. The withdrawals will be changing each year as the cost of college changes. Assume that the first withdrawal is at the end of the child's 18th year Calculate and present a payment schedule that shows: Year Beg Ba Pmt Interest Withdrawa Ending Balance in Account Develop an Excel spreadsheet to calculate the necessary values and complete the payment schedule table for the appropriate years. The table should not contain entries for years that are not relevant. For example, if the first deposit was made when child was four years old, the table should begin with age 1 and end at the end of year 22. Also construct graphs showing the ratio of interest/pmt for each year a payment is made. The spreadsheet should be constructed so that anytime new input parameters (Items#1 thru #4 above) are used as inputs, the results will be computed & revised to display the new values

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Beyond Greed And Fear Understanding Behavioral Finance And The Psychology Of Investing

Authors: Hersh Shefrin

1st Edition

0195161211, 978-0195161212

More Books

Students also viewed these Finance questions

Question

Complexity of linear search is O ( n ) . Your answer: True False

Answered: 1 week ago