Purchase Solution

# Financing grandchild's education

Not what you're looking for?

A grandmother is looking for a plan to finance her new grandchild's college education. She has \$25,000 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.
Calculate 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 \$25,000. 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:

oF(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.

##### Solution Summary

A grandmother is looking for a plan to finance her new grandchild's college education. She has \$25,000 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. Calculate the future value of the investment?

Solution provided by:
###### Education
• MBA, Aspen University
• Bachelor of Science , Berea College
###### Recent Feedback
• "Thank u"
• "Thank You!"
• "Thanks!"
• "Thank you so much"
• "Great job...thanks."

##### Free BrainMass Quizzes

This quiz test you on how well you are familiar with solving quadratic inequalities.

##### Probability Quiz

Some questions on probability

##### Multiplying Complex Numbers

This is a short quiz to check your understanding of multiplication of complex numbers in rectangular form.

##### Geometry - Real Life Application Problems

Understanding of how geometry applies to in real-world contexts