Suppose the average cost of one year of private college with tuition, room, board and fees is currently (2021) is $51,000. Assume your first child is born in 2031 and that they will enter a four year college when they are 18 years old. Assume that the cost of college continues to appreciate (increase) at the current rate of 5% per year. Label each quantity with the variable that corresponds to the formula you are using. You may use the Google Sheet Calculator. Single number answers will be given no credit. 1. Find the total cost of all four years of college for your child. Be sure to calculate cach one separately and find their sum, since each year the tuition will be different. Use this answer as your future" amount in the following questions. - freshmen - F = 51,000 (17.05) 28 - 199,926.54 suph - duniar - F-31,000 (1710s) 30 F 51,000 (1r.ossa - 209, 922, 922 220, 419.06 seniar - F = 51,000 (It oss "= 231,440.01 $861.708,58 2. SAVINGS OPTION A: Find the amount of a single investment made today (2021) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume monthly compounding and an APR of 2%. Circle the formula you are using: Single Deposit Systematic Savings Loan 3. SAVINGS OPTION B: Find the amount of a single investment made the day your child is born (2031) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume monthly compounding and an APR of 2%. Circle the formula you are using Single Deposit Systematic Savings Loan 4. How much MORE money must you invest the day your child is born compared to starting your investment today? Show work! 5. SAVINGS OPTION Find the amount of a monthly investment made today (2021) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume an APR of 2%. Circle the formula you are using Single Deposit Systematic Savings Loan 3. SAVINGS OPTION D: Find the amount of a monthly investment made the day your child is born (2031) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume an APR of 2%. Circle the formula you are using: Single Deposit Systematic Savings Loan 6. How much more per month must you save if you start your investment the day your child is born compared to starting your investment today? Show work. 7. Let's compare each option side by side. How much money total did you spend "out of pocket" for each option? Show any necessary work a. Option A: (SINGLE) b. Option B: (SINGLE) c. Option C: (MONTHLY) d. Option D: (MONTHLY) Which option costs YOU the least amount of money? Why did this happen? 8. What might be your life factors" (not interest rates) that you might you consider when choosing to do a single investment versus a monthly investment? Write a full sentence or two. 9. If you are like most students/families, you will not have this much money to save for college. If you as the parent decide to take out a loan for the full tuition amount, find the monthly payment on the loan if you get an APR of 4.7% and borrow the money for: Circle the formula you are using: Single Deposit Systematic Savings Laan a. four years b. ten years c. thirty years 10. If you take thirty years to repay the college loan (PART 9c above), how much did you REALLY pay for four years of college total? How much interest did you pay? 3500 11. do ok again at your answer to par 9c. Suppose you can only afford a monthly loan repayment of species at the same rate as question 9 (4.7%). How many years will it take you to repay the loan? Circle the formula you are using: Single Deposit Systematic Savings Loan 12. How has this exercise made you think differently about saving and borrowing money? Write at least two sentences. Suppose the average cost of one year of private college with tuition, room, board and fees is currently (2021) is $51,000. Assume your first child is born in 2031 and that they will enter a four year college when they are 18 years old. Assume that the cost of college continues to appreciate (increase) at the current rate of 5% per year. Label each quantity with the variable that corresponds to the formula you are using. You may use the Google Sheet Calculator. Single number answers will be given no credit. 1. Find the total cost of all four years of college for your child. Be sure to calculate cach one separately and find their sum, since each year the tuition will be different. Use this answer as your future" amount in the following questions. - freshmen - F = 51,000 (17.05) 28 - 199,926.54 suph - duniar - F-31,000 (1710s) 30 F 51,000 (1r.ossa - 209, 922, 922 220, 419.06 seniar - F = 51,000 (It oss "= 231,440.01 $861.708,58 2. SAVINGS OPTION A: Find the amount of a single investment made today (2021) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume monthly compounding and an APR of 2%. Circle the formula you are using: Single Deposit Systematic Savings Loan 3. SAVINGS OPTION B: Find the amount of a single investment made the day your child is born (2031) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume monthly compounding and an APR of 2%. Circle the formula you are using Single Deposit Systematic Savings Loan 4. How much MORE money must you invest the day your child is born compared to starting your investment today? Show work! 5. SAVINGS OPTION Find the amount of a monthly investment made today (2021) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume an APR of 2%. Circle the formula you are using Single Deposit Systematic Savings Loan 3. SAVINGS OPTION D: Find the amount of a monthly investment made the day your child is born (2031) that will grow to the amount necessary to pay for four years of tuition by the year your child enters college. Assume an APR of 2%. Circle the formula you are using: Single Deposit Systematic Savings Loan 6. How much more per month must you save if you start your investment the day your child is born compared to starting your investment today? Show work. 7. Let's compare each option side by side. How much money total did you spend "out of pocket" for each option? Show any necessary work a. Option A: (SINGLE) b. Option B: (SINGLE) c. Option C: (MONTHLY) d. Option D: (MONTHLY) Which option costs YOU the least amount of money? Why did this happen? 8. What might be your life factors" (not interest rates) that you might you consider when choosing to do a single investment versus a monthly investment? Write a full sentence or two. 9. If you are like most students/families, you will not have this much money to save for college. If you as the parent decide to take out a loan for the full tuition amount, find the monthly payment on the loan if you get an APR of 4.7% and borrow the money for: Circle the formula you are using: Single Deposit Systematic Savings Laan a. four years b. ten years c. thirty years 10. If you take thirty years to repay the college loan (PART 9c above), how much did you REALLY pay for four years of college total? How much interest did you pay? 3500 11. do ok again at your answer to par 9c. Suppose you can only afford a monthly loan repayment of species at the same rate as question 9 (4.7%). How many years will it take you to repay the loan? Circle the formula you are using: Single Deposit Systematic Savings Loan 12. How has this exercise made you think differently about saving and borrowing money? Write at least two sentences