Your uncle is planning a college fund for his five-year-old daughter. The total cost of a college education is estimated to be $25,000 in the 2021-2022 academic year.

This cost has risen 2.5% over the last year. Your uncle believes he can earn 8% on investments to meet this goal. Answer the following:

A. If costs continue to rise 2.5% per year, how much will it cost for the first year of tuition in 13 years?

B. Assuming your uncle will have enough money saved in 13 years to cover all four years of college costs, how much will he need to have accummulated by then?

(Hint: the cost of tuition is a graduated annuity growing 2.5% per year).

C. If he was to invest a lump sum today in hopes of covering all four years of college costs, how much would he have to invest?

D. Now, assume he would like to make yearly contributions instead, how much would he have to invest each year?