The Washingtons need help planning for college finances for their two children, Hillary and

Donald. They expect their second child, Hillary, to start college in 15 years. At that time, they

would like to have enough money on hand to withdraw $12,500 per quarter to pay tuition at

Wellesley College. Because college will last four years, they need to make a total of 16 quarterly

withdrawals, with the first one made the day Hillary starts college. They plan on gathering the

necessary funds by making quarterly deposits into an account which pays 8% APR, compounded

quarterly. However, there is one complication. Donald will start college at a different school in 8

years, University of Pennsylvania. Due to a generous uncle, the Washingtons already have

enough money to pay for Donald's education. However, due to the high cost of college living

expenses, the Washingtons will be unable to add to Hillary's college fund while Donald is in

college. Therefore, they will have to stop making deposits the day that Donald starts college.

Thus the Washingtons will be able to make a total of 32 quarterly deposits into Hillary's college

fund, with the first deposit at the end of the first quarter and the final deposit occurring the day

Donald starts college. What should be the amount of these quarterly deposits?

Do scenario analysis (via a data table) as follows:

Vary the APR from 6% to 12% in 1% increments. Show the effect on the quarterly

deposits.

Vary start date of Donald's college from 6 to 12 years. Show the effect on the quarterly

deposits.

Vary the APR from 6% to 12% in 1% increments and vary the withdraw from $10,000 to

$15,000 in $500 increments. Show the effect on your quarterly deposits.

Hint: APR represents annual rate. To get quarterly rate, you need to divide APR by 4.