You plan to set up an endowment at your alma mater that will fund $200,000 of scholarships

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You plan to set up an endowment at your alma mater that will fund $200,000 of scholarships each year indefinitely. If the principal (the amount you donate) can be invested at 5.5 percent, compounded annually, how much do you need to donate to the university today, so that the first scholarships can be awarded beginning one year from now?
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Fundamentals of Corporate Finance

ISBN: 978-1118845899

3rd edition

Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates

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