How much money do you need today in your savings account

Assignment Help Financial Management

Reference no: EM131063040

Your daughter will start college one year from today, at which time the first tuition payment of $58,000 must be made. Assuming that tuition does not increase over time and that your daughter remains in school for four years, how much money do you need today in your savings account, earning 5% per annum, in order to make the tuition payments over the next four years ? *Make sure to input all currency answers without any currency symbols or commas, and use two decimal places of precision.

Reference no: EM131063040

Questions Cloud

What is the amount of current assets : A company has $530 in inventory, $180 in accounts receivable, $1,880 in fixed assets, $80 in cash and $300 in accounts payable. What is the amount of current assets?

What is the present value of this liability : Asendia USA has an unfunded pension liability of $6 million that must be paid in 20 years. To assess the value of the firm's stock, financial analysts want to discount this liability back to the present. The relevant discount rate is 6.5%. What is th..

Relationship between risk and required rate of return : The security market line (SML) provides the relationship between risk and required rate of return. Which of the following statements about the SML is most correct? The relevant risk is portfolio risk, which is measured by beta The relevant risk is to..

About the home equity line of credit : A home equity line of credit (HELOC) is, loosely speaking, like a credit card for your home. You can borrow money by drawing down on the line of credit. But, because the borrowed money is for the purpose of your home, the interest is tax-deductible m..

How much money do you need today in your savings account : Your daughter will start college one year from today, at which time the first tuition payment of $58,000 must be made. Assuming that tuition does not increase over time and that your daughter remains in school for four years, how much money do you ne..

Government have to pay bondholders each year in perpetuity : Imagine that the government decided to fund its current deficit of $431 billion dollars by issuing a perpetuity offering a 4% annual return. How much would the government have to pay bondholders each year in perpetuity?

Future value notations denotes the value as of period : Which of the following future value notations denotes the value as of period 11 of a cash flow received in period 2?

Make your fourth and final deposit : Imagine that you deposit $6,000 a year, starting one year from today, for four years into a savings account paying 6% per annum. (That is four deposits of $6,000 per year.) How much money will you have immediately after you make your fourth and final..

The cost of equity and flotation costs : Messman Manufacturing will issue common stock to the public for $40. The expected dividend and growth in dividends are $2.75 per share and 5%, respectively. If the flotation cost is 14% of the issue's gross proceeds, what is the cost of external equi..

User Account

All Pages