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Mary passed away this year, leaving an estate of $2,000,000. At the time of her death her two children, Sara and Tom, were 18 and
Mary passed away this year, leaving an estate of $2,000,000. At the time of her death her two children, Sara and Tom, were 18 and 20 (exactly), respectively. The terms of Mary's will are such that Sara and Tom shall inherit her estate, each inheriting their portion when they turn twenty-one. According to Mary's will, the amount that Sara can receive when Sara turns 21, is twice as much as the amount that Tom can receive when Tom turns 21. From the time of her death, Mary's estate is invested, and earns 4.74% p.a. interest, payable half-yearly (i.e., j2 = 4.74% p.a.). a) How much does Sara receive when she turns 21? Select one: a. 1485879.0 b. 1333333.3 c. 1407889.6 d. 1484054.8
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