Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

A grandmother is looking for a plan to finance her new grandchild's college education. She has $62,000 to invest. Search the internet and locate a long-range investment plan, CD, Savings Bond, etc, for the grandmother. The plan is to earn compound interest.

find out the future value of the investment. You must use the advertised interest rate, the number of compounding periods per year, and the time the funds will be invested. If you are not given the number of compounding periods a year, make it up.

The principal is $62,000. This is P.
Research the annual interest rate for your investment. This is r.
State the time in years for the investment (as in when the new grandchild will be attending college). This is t.
State the number of compounding periods per year. This is n.
Model the future value of Grandma's investment as an exponential function, with time as the independent variable: F(t) = P(1 + r/n) nt
State the future value of Grandma's investment.
Use the internet or library resources to find the average cost of a college education today; will grandma's investment be able to cover the cost in today's dollars; what about in the future?
Summarize your findings in writing using proper style and grammar.
Include references formatted according to APA style.

 

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M925375

Have any Question? 


Related Questions in Basic Finance

Explain the process by which a mortgage- backed security is

Explain the process by which a mortgage- backed security is created. What roles do Ginnie Mae, Fannie Mae, and Freddie Mac play?

You are thinking of opening a small copy shop it costs 8000

You are thinking of opening a small copy shop. It costs $8000 to rent a copier for a year and costs $0.023per copy to operate the copier. Other fixed costs ofrunningthe store will amount to $600 per month. Youplan to cha ...

Technological advances have reduced the servicing costs on

Technological advances have reduced the servicing costs on loans. What would happen to the discount factor applied to value mortgages and mortgage backed securities and why?

Us has experienced continuous current account deficits

US has experienced continuous current account deficits since the early 1980s. What do you think are the main causes for the deficits? What would be the consequences of continuous U.S current account deficits?

What are derivatives define forward futures and option

What are derivatives? Define forward, futures, and option agreements. What are the underlying instruments in these agreements?

In june 2010 john pays 9800 for a one- year t-bill that can

In June 2010, John pays $9,800 for a one- year T-bill that can be redeemed for $10,000. What is the amount of interest earned? What is the yield?

During the great depression of the 1930s nominal interest

During the Great Depression of the 1930s, nominal interest rates were close to zero. Explain how real interest rates could be very high even though nominal interest rates were very low. (Hint: Prices fell during parts of ...

Nicole corporations year-end 2009 balance sheet lists

Nicole Corporation's year-end 2009 balance sheet lists current assets of $756,000, fixed assets of $606,000, current liabilities of $539,000, and long-term debt of $694,000. What is Nicole's total stockholders' equity?

Suppose if you spend 1 million today on a research project

Suppose if you spend $1 million today on a research project, there is a 30% chance of success at year-end and a 70% chance of failure. In the event of failure, you can decide to invest another $1 million to continue the ...

Problem set 11 go to the website Problem Set 1 1. Go to the website

Problem Set 1 1. Go to the website http://online.wsj.com/mdc/page/marketsdata.html, click on the tab "rates," click on the tab "Bonds, Rates and Credit Markets," click on "Treasury Quotes," and then answer the following ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate