1. Suppose the university offers you a special scholarship and you will receive one single payment at the end of each year for your excellent academic performance over the previous 12 months. Today, December 31, you just received $40,000 and you plan to spend all of it to buy the new Samsung Galaxy S10. However, after taking , your finance class, you decided that you will start saving for the future beginning next year. The plan is as follows:

• One year from today, you will begin depositing 7% of your annual scholarship in an account with 8% interest rate per year, quarterly compounding.
• Meanwhile, your scholarship will increase at 2 percent per year for 30 years.

How much money you will have in 30 years? (Hint: you need to find the present value of this plan first, then convert it to its future value in 30 years.) (10 marks)