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On your child’s 1st birthday, you open an account to fund his college education. You deposit $300 to open the account. Each year, on his
birthday, you make another deposit. Each subsequent deposit is 8% larger than the previous one. The account pays interest at 5%/year compounded annually. How much money is in the account immediately after the deposit on his 18th birthday?
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- A mother wishes to set up a savings account for her son's education. She plans on investing $750 when her son is 6 months old and every 6 months thereafter. The account earns interest of 8 percent per year, compounded semiannually. (a) To what amount will the account grow by the time of her son's 18th birthday? (b) How much interest will be earned during this period?On a child's first birthday, a parent wishes to deposit enough money so that the child can withdraw $5000 per year for five years. If the first withdrawal will be on the child's 18th birthday, how much should the parent deposit? The rate is 5% annually.A man deposited $10,000 in a savings account when his son was born. The nominal interest rate was 8% per year, compounded continuously. On the son’s 18th birthday, the accumulated sum is withdrawn from the account. How much will this accumulated amount be?
- A father wants to set aside money for his 5-year-old son's future college education. Money can be deposited in a bank account that pays 8% per year, compounded annually. What equal deposits should be made by the father, on his son's 6th through 17th birthdays, in order to provide $5000 on the son's 18th, 19th, 20th, and 21st birthdays?On the day his baby was born, a father decided to establish a savings account for the child’s college education. Any money that is put into the account will earn an interest rate of 8% compounded annually. The father will make a series of annual deposits in equal amounts of $5,000 on each of his child’s birthdays from the 1st through the 18th, so that he can make withdrawals from the account on the child’s 18th birthday for child's college funds. Find the amount accumulated at the end of child's 18th birthday. (Also draw the cash flow diagram).A child deposits his birthday money of $350 into an account that pays 5.6% interest compounded quarterly. How much money will he have in the account 25years later?
- Gilberto opened a savings account for his daughter and deposited $1000 on the day she was born. Each year on her birthday, he deposited another $1000. If the account pays 11% interest, compounded annually, how much is in the account at the end of the day on her 12th birthday? At the end of the day on her 12th birthday, the amount in the account is $ (Simplify your answer. Type an integer or a decimal. Round to the nearest cent if needed.)On the day his son was born, a father deposited to a trust company a sufficient amount of money so that his son could receive money in the future. There was a provision that the son can withdraw an amount of P10,000 each year for 3 years starting on his 13th birthday and P16,600 ten months after the last withdrawal. The interest rate is 6% compounded monthly. What is the effective interest rate? How much did the father deposit? How much money can he receive on his 13th birthday, if he decided to withdraw all the money at once?On the day his son was born, a father deposited to a trust company a sufficient amount of money so that his son could receive money in the future. There was a provision that the son can withdraw an amount of P10,000 each year for 3 years starting on his 18th birthday and P15,000 eight months after the last withdrawal. The interest rate is 5% compounded monthly. 1. What is the effective interest rate? 2. How much did the father deposit? 3. How much money can he receive on his 18th birthday, if he decided to withdraw all the money at once?
- Melinda opened a savings account for her daughter on the day she was born, depositing $1,000: Each year on her birthday she deposits another $1,000 making the last deposit on her 21st birthday. The account pays 9.5% interest compounded annually. Find the total amount accumulated in the account at the end of the day on the daughters 21st birthday. (answer in whole number)Willie deposits a fixed monthly amount into an annuity account for his child’s college fund. He wishes to accumulate a future value of $125,000 in 15 years. Assuming an APR of 3.5% how much money should Willie deposit monthly in order to reach his goal. How much of the $125,000 will Willie ultimately deposit in the account, and how much is interest earned?On your 21st birthday you receive $10,000 as a result of a deposit that your grandparents made on the day you were born. How large was that deposit if it earned interest at 6% p.a.?