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Tuition Payment Using Bank Account Annually Compounded Interest

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Tuition is $10,000 per year for 4 years starting next year (that is, I will need to withdraw the first $10,000 on year from today).
A deposit in a bank will be made today; bank will pay 7% interest, compounded annually, a sum of money that is sufficient to provide the 4 payments of $10,000 each.
a) how large will the deposit be?
b) how much will be in the account immediately after you make the 1st withdrawal?

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The expert examines calculations in a document and excel file. The expert examines tuition payment using bank accounts annually compounded interest.

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Tuition is $10,000 per year for 4 years starting next year (that is, I will need to withdraw the first $10,000 on year from today).
A deposit in a bank will be made today; ...

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Manal Elkhoshkhany, MBA
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  • MBA, California State University, Sacramento
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