Calculate the Future Cash Outflow, Lump Sum Outflow (when college begins), and t

Question

Calculate the Future Cash Outflow, Lump Sum Outflow (when college begins), and the Required Annual Savings for Jose Degala, 10 years of age. Tuition, currently at $16,000 per year, is expected to increase 5% a per year and that they can earn about 7% return on their investments. Child's Name Jose 1. Annual College Cost (Today's Dollar Amount) $ 16,000 Number of periods until student begins college 8 Inflation5 5.00% 2. Cash Outflow Future: $ ??? Number of Periods Child Will Attend College 4 Inflation% 5.00% Education Investment Rate 7.00% Real Rate (inflation-adjusted)% ??? 3. Lump Sum Outflow (when college begins) ??? Number of periods until student begins college 8 Education investment Rate% 7.00% 4. Assets Required Future 0 5. Required Annual Savings $ ??? REQUIRED: (a) Cash Outflows Future ?????? (Round your answer to the nearest whole dollar. Omit the comma and "$" sign in your response.) (b) Real Rate (inflation-adjusted) ?????? (Round your answer to the nearest 4 decimals. Omit the "%" sign in your response below. For example: 2.3432, 1.2167) (c) Lump Sum Outflow (when college begins) ?????? (Round your answer to the nearest whole dollar. Omit the comma and "$" sign in your response) (d) Required Annual Savings ?????? (Round your answer to the nearest whole dollar. Omit the comma and "$" sign in your response)

Explanation / Answer

Cash Outflows future:for Year 2 = $16000*1.05 = $16800for Year 3 = $16800*1.05 = $17640for year 4 = $18522number years child will attend college: 4Inflation rate: 5

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.