You want to save money for the next 10 years for the school expenses of your child. You estimate that annual school tuition of your child will be $15,000 per year in constant dollars (base period n=0), which will be paid at the end of 11^th and 12^th years. You plan to deposit a fixed portion of your salary every quarter starting from the end of the first quarter in a bank account which pays 11% annual interest compounded daily. You expect your salary to increase by 2% every quarter, so your deposits will increase by the same rate. You estimate that the average annual general inflation rate would be 2% compounded monthly. (Note: assume that there are 30 days per month and 360 days per year)

a) Find the effective quarterly interest that the bank pays.

b) Find the effective general inflation rate per quarter.

c) Find the effective inflation-free interest rate per quarter.

d) Find the amount that you have to deposit at the end of the first quarter to achieve your goal.

e) Assume that your child is granted a scholarship at the end of the eighth year and you decided to give the amount accumulated in the savings account to your child as a gift for the success. What would be the amount that you will give to your child in actual dollars?