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Frank Thomas is planning for the day when his child, Laura, will go to college. Laura has just turned 8 and plans to enter college on her 18th birthday. She will need $25,000 at the beginning of each year in school. Frank plans to give Laura a Mercedes-Benz as a combination graduation and 22nd birthday present. The Mercedes is expected to cost $50,000. Frank currently has $20,000 saved for Laura. Also, Frank expects to inherit $30,000 9 years from now that will be used for Laura's education. Frank expects to be able to earn 5% after tax on any investments. How much must Frank save at the end of each year for the next 10 years in order to provide for Laura's education and auto?

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Category:- Corporate Finance
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