Answered

Looking for trustworthy answers? Westonci.ca is the ultimate Q&A platform where experts share their knowledge on various topics. Discover comprehensive solutions to your questions from a wide network of experts on our user-friendly platform. Explore comprehensive solutions to your questions from knowledgeable professionals across various fields on our platform.

Assume the total cost of a college education will be $184,061 when your child enters college in 19 years. You presently have $49,327 to invest. What annual rate of interest must you earn on your investment to cover the cost of your child's college education? Enter answer as 3 decimal places (e.g. 0.123)

Sagot :

Answer:

Interest rate = 0.9313

Explanation:

Future value or the cost of edcuation after 19 years = $184061

Present value, money in hand at present = $49327

Time period, n = 19

Future value = Present value (1 + r)²

184061 = 49327 (1 + r )²

(1 + r )² = 184061 ÷ 49327

(1 + r )² = 3.73

(1 + r) = √3.73

(1 + r) = 1.9313

r = 1.9313 - 1

r = 0.9313

Or Interest rate = 0.9313

We hope you found this helpful. Feel free to come back anytime for more accurate answers and updated information. We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. Your questions are important to us at Westonci.ca. Visit again for expert answers and reliable information.