Suppose that you are planning to enroll in a masters degree program two years in the future. Its cost will be the equivalent of $160,000 to enroll. You expect to have the following funds:

Fromyourcurrentjob,youcansave$5,000afteroneyearand$7,000after two years.

You expect a year-end bonus of $10,000 after one year and $12,000 after two years.

Your grandparents have saved money for your education in a tax-favored savings account, which will give you $18,000 after one year.

Your parents offer you the choice of taking $50,000 at any time, but you will get that amount deducted from your inheritance. They are risk-averse investors and put money in ultrasafe government bonds that give 2 percent per year.

The borrowing and the lending rate at the bank is 4 percent per year, daily compounded. Approximating this by continuous compounding, how much money will you need to borrow when you start your masters degree educa- tion two years from today?