Lucas is wondering if he has enough money to cover his college tuition for the next four years. Annual tuition is $8,000 (assume this is a negative cash flow) that is due at the beginning of each year with the first payment due today. If Lucas can earn a 2% return on his savings account, how much does he need to have in his account now to cover the cost of tuition?

What formulas are used to obtain answers?

rate nper pmt pv type FV