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Please help ASAP (10) 2. You are working as a financial advisor, and one of your clients, Heather, has a new born child, Alexander. Heather
Please help ASAP
(10) 2. You are working as a financial advisor, and one of your clients, Heather, has a new born child, Alexander. Heather wants to be sure that, when it is time for Alexander to attend college, there is money enough for him to do so. Currently (i.e., t=0) one year of college costs $30,000, and this cost is expected to increase by 2% per year, forever. Heather expects that Alexander will begin to attend college when he is 17 years old (i.e., at t=17). Assume that the cost of each year of college must be paid for at the beginning of that year; so, for example, Alexander will pay for the first year of college at t=17, the second year at t=18, etc. Heather plans to invest the same amount of money each year from now until Alexander finishes paying for college. That is, Heather will invest the same amount of money each year beginning today (i.e., at t=0) and ending when Alexander pays for his last year of college (i.e., at t=20). If Heather earns 6% per year on the money she invests, how much money must Heather invest each year to completely cover the cost of four years of college for Alexander? (10) 2. You are working as a financial advisor, and one of your clients, Heather, has a new born child, Alexander. Heather wants to be sure that, when it is time for Alexander to attend college, there is money enough for him to do so. Currently (i.e., t=0) one year of college costs $30,000, and this cost is expected to increase by 2% per year, forever. Heather expects that Alexander will begin to attend college when he is 17 years old (i.e., at t=17). Assume that the cost of each year of college must be paid for at the beginning of that year; so, for example, Alexander will pay for the first year of college at t=17, the second year at t=18, etc. Heather plans to invest the same amount of money each year from now until Alexander finishes paying for college. That is, Heather will invest the same amount of money each year beginning today (i.e., at t=0) and ending when Alexander pays for his last year of college (i.e., at t=20). If Heather earns 6% per year on the money she invests, how much money must Heather invest each year to completely cover the cost of four years of college for AlexanderStep by Step Solution
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