This assignment is directly related to the time value of money in Chapter 4 and Chapter 5 in the Corporate Finance textbook by Ross, Westerfield, Jaffe & Jordan, 4th Edition. Answer the following questions:

This assignment is directly related to the time value of money. Answer the following questions:

Let's assume that you're preparing for your (future) child (or grandchild)'s college education. 20 years later from now, your (future) child will go to college. Currently you're considering two colleges for your (future) child (or grandchild). The following is the list of universities are assigned to you.

University 1 University 2

Rutgers University Manhattan College

Estimate future costs of two colleges for your (future) child (or grandchild) and calculate needed annual savings for two colleges. Please specify your assumptions for computation of future costs and needed annual savings.

1.Please visit website of each university and find tuition and related information. Use out-of-state tuition information.Make sure that you include accurate information and citation source.

2.Using the tuition and related information in (1), you need to compound it at a reasonable "inflation" rate for education-related expenses for x number of years. I hope most of you are aware that educational inflation has been much higher than overall inflation in the economy, (You can find 'tuition inflation' statistics from the internet. Use google.com and search for tuition inflation or education inflation).

3.After you calculate this projected cost, your next job is to find the annual deposit needed to accomplish the goal - meeting the educational expenses. You must assume the investment rate of return (You can use 'savings account rate as your investment rate of return, for example). Recall the equations or time value of money table we went over in class. You will choose the one that will give you the amount of the annual deposit.

4.What if you have $10,000 right now? How does this new information affect previous answer in (3)? What's new annual deposit amount you should make?

5.Let's assume that you just won the lottery. Rather than making equal annual payments, you decided to make one lump-sum deposit today to cover your child's future college expense needs. There will be no additional deposit. How much should you make one lump-sum deposit today to accumulate projected college education expense you need in 20 years?

NOTES:

RUTGERS UNIVERSITY COLLEGE TUITION INFORMATION:

https://www.collegedata.com/cs/data/college/college_pg03_tmpl.jhtml?schoolId=1441

As of 2017 cost of attendance out-of-state:$47,384

RUTGERS TREND FOR INCREASES:

https:/ews.rutgers.eduews-release/rutgers-continues-trend-modest-rate-increases-17-percent-increase-tuition-and-mandatory-fees-state/20160720#.WfU5FGhSyUk

Rutgers University - New Brunswick tuition and fees for out-of-state students increased at a standard yearly rate of3.8% over the past five years.Over that same period, tuition increased by 4.0% and fees increased by 2.4%. Based on this, we predict the price of tuition and fees this year will be$31,176.

At this rate, we estimate the total cost of tuition and fees for a two-year degree to be $63,549 and for a four year degree to be $132,072. This doesn't cover other charges such as room and board, books, and transportation.

MANHATTAN COLLEGE TUITION INFORMATION:

https://www.collegedata.com/cs/data/college/college_pg03_tmpl.jhtml?schoolId=149

As of 2017 cost of attendance out-of-state:$58,375

MANHATTAN COLLEGE TREND FOR INCREASES:

https://www.collegetuitioncompare.com/trends/manhattan-college/

Tuition and fees grew by 32.90% last five years, $30,100 (2013) to $40,004 (2017).

Living costs, including room and board and other expenses was increased by 16.51% from $14,600 (2013) to $17,010 (2017) when students live on campus.

My grandchild will be living on campus, getting her Business Degree from either college listed above. She will be receiving scholarships to help with books and supplies. Her parents, grandparents and close relatives will help with miscellaneous expenses and off-campus transportation.

Please se attached file for additional information.

This assignment is directly related to the time value of money in Chapter 4 and Chapter 5 in the Corporate Finance textbook by Ross, Westerfield, Jaffe & Jordan, 4th Edition. Answer the following questions: This assignment is directly related to the time value of money. Answer the following questions: Let's assume that you're preparing for your (future) child (or grandchild)'s college education. 20 years later from now, your (future) child will go to college. Currently you're considering two colleges for your (future) child (or grandchild). The following is the list of universities are assigned to you. University 1 Rutgers University University 2 Manhattan College Estimate future costs of two colleges for your (future) child (or grandchild) and calculate needed annual savings for two colleges. Please specify your assumptions for computation of future costs and needed annual savings. 1. Please visit website of each university and find tuition and related information. Use out-of-state tuition information. Make sure that you include accurate information and citation source (20 points). 2. Using the tuition and related information in (1), you need to compound it at a reasonable "inflation" rate for educationrelated expenses for x number of years. I hope most of you are aware that educational inflation has been much higher than overall inflation in the economy, (You can find 'tuition inflation' statistics from the internet. Use google.com and search for tuition inflation or education inflation). 3. After you calculate this projected cost, your next job is to find the annual deposit needed to accomplish the goal meeting the educational expenses. You must assume the investment rate of return (You can use 'savings account rate as your investment rate of return, for example). Recall the equations or time value of money table we went over in class. You will choose the one that will give you the amount of the annual deposit. 4. What if you have $10,000 right now? How does this new information affect previous answer in (3)? What's new annual deposit amount you should make? 5. Let's assume that you just won the lottery. Rather than making equal annual payments, you decided to make one lumpsum deposit today to cover your child's future college expense needs. There will be no additional deposit. How much should you make one lumpsum deposit today to accumulate projected college education expense you need in 20 years? NOTES: RUTGERS UNIVERSITY COLLEGE TUITION INFORMATION: https://www.collegedata.com/cs/data/college/college_pg03_tmpl.jhtml?schoolId=1441 As of 2017 cost of attendance outofstate: $47,384 RUTGERS TREND FOR INCREASES: https:/ews.rutgers.eduewsrelease/rutgerscontinuestrendmodestrateincreases17percent increasetuitionandmandatoryfeesstate/20160720#.WfU5FGhSyUk Rutgers University New Brunswick tuition and fees for outofstate students increased at a standard yearly rate of 3.8% over the past five years. Over that same period, tuition increased by 4.0% and fees increased by 2.4%. Based on this, we predict the price of tuition and fees this year will be $31,176. At this rate, we estimate the total cost of tuition and fees for a twoyear degree to be $63,549 and for a four year degree to be $132,072. This doesn't cover other charges such as room and board, books, and transportation. MANHATTAN COLLEGE TUITION INFORMATION: https://www.collegedata.com/cs/data/college/college_pg03_tmpl.jhtml?schoolId=149 As of 2017 cost of attendance outofstate: $58,375 MANHATTAN COLLEGE TREND FOR INCREASES: https://www.collegetuitioncompare.com/trends/manhattan-college/ Tuition and fees grew by 32.90% last five years, $30,100 (2013) to $40,004 (2017). Living costs, including room and board and other expenses was increased by 16.51% from $14,600 (2013) to $17,010 (2017) when students live on campus. My grandchild will be living on campus, getting her Business Degree from either college listed above. She will be receiving scholarships to help with books and supplies. Her parents, grandparents and close relatives will help with miscellaneous expenses and off-campus transportation. If you must respond to me via e-mail, my address is: nvmcneal@gmail.com Thank you