1)
the amount required to be calculated is the future value of an annuity of per year investment of 2080
hence future value interest rate factor of annuity (FVIFA) has been calculated for 10% and period of investment of17 years
required future value = FVIFA*2080


If Alexis's parents also decided to invest $40 per paycheck each, or $2,080/yr. for her college...
If you and your spouse each invest S50 per paycheck, or $2,600 per year for 40 years at 8% what will it be worth? Mr. & Ms. Johnson recently had a 5-lb. baby girl, named Alexis. When Alexis was born her grandmother opened an education trust fund with $10,000 that Alexis can receive at age 17, provided she goes to college. What will the fiund be worth in 17 years assuming an average return of 10%?
Lynn Swartz's husband died 3 years ago. Her parents, who have income of over $200,000 per year, want to ensure that funds will be available for the education of Lynn's 8-year-old son, Eric. Lynn is currently earning $45,000 a year. Lynn's parents have suggested that they start a savings account for Eric. They have calculated that if they invest $4,000 per year for the next 8 years, sufficient funds will be available at the end of 10 years for Eric's...