QUESTION 17

Richard and Sue wants to provide full funding for their 3 year old daughter who is expected to start college when she is 18. The current annual cost of a 4 year college is $38,000 which is expected to increase by 3.5% per year. They expect to earn 5% on their investment. Calculate the expected annual tuition cost when their daughter turns 18.

ANSWERS

A. $47,154

B. $63,663

C. $78,999

D. $47,527