Question
Prof. Benjamin Breeg is planning to make a contribution to his alma mater. The donation is to be made over a 5-year period beginning now,
Prof. Benjamin Breeg is planning to make a contribution to his alma mater. The donation is to be made over a 5-year period beginning now, a total of six equal payments. It is intended to support a scholarship program which supports one student per year for 25 years, with the first scholarship to be awarded in year 6 (EOY 6 ) and continuing until EOY 30. The scholarship in each year should have the same purchasing power as $5000today. If the college can invest the donations in a fund that earns interest at the rate of 10% per year, what size must the donations be? An inflation rate of 4% per year is expected.
Please draw cash flow diagram+ use scientific notation like (A/F, I,n)
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