Question
You are setting up a trust fund to give engineering students scholarships forever, and should be able to get 5% interest on the fund. You
You are setting up a trust fund to give engineering students scholarships forever, and should be able to get 5% interest on the fund. You would like to:
Provide 1 student with a $2,000 scholarship EACH YEAR
Provide an additional student with a $5,000 scholarship every four years, STARTING IN YEAR FOUR.
a.Draw the cash flow diagram for the problem include 4 years in the diagram (one cycle).
b. How much money needs to be in the trust fund today to financially support the scholarship fund forever?
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Focus On Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes, Melissa Hart
7th Edition
1265521972, 978-1265521974
