HomeworkLib
Question

An educational fund is to be allocated by a philanthropist. The fund will be deposited into...

An educational fund is to be allocated by a philanthropist. The fund will be deposited into an account that earns an interest of 2.0% per year. The total fund raised is $8.5 million and is put in a scholarship program to generate annual scholarships per year infinitely. Calculate how much in scholarship money can be awarded every year from this education fund.

business   economics   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Interest rate = 2%

Total fund raised = 8.5m = 8500000

The money that can be awarded every year from this education fund = 8500000*2% = 170000

0 0
Add a comment
Know the answer?
Add Answer to:
An educational fund is to be allocated by a philanthropist. The fund will be deposited into...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • Problem 6 Intro Brooklyn College alumni recently established an endowment fund that will provide annual scholarships...

    Problem 6 Intro Brooklyn College alumni recently established an endowment fund that will provide annual scholarships of $12,000 for 20 years. The first scholarship will awarded 5 year from now. The fund can earn annual rate of return at 6% managed by professional managers. B Attempt 1/10 for 10 pts. Part 1 How much money should the alumni put into the fund today? No decimals Submit

  • A generous benefactor invested money in a scholarship fund ten years ago at an interest rate...

    A generous benefactor invested money in a scholarship fund ten years ago at an interest rate of 8 percent. Every year (and continuing on indefinitely into the future), the fund awards $50,000 in scholarships to worthy college students. How much did this benefactor deposit into the account initially? Assume all interest is paid out annually but the principal amount remains untouched. a. 625,500 b. 500,000 c. 462,963 d. 400,000

  • The Association of Women in Government established an Educational Foundation to raise money to support scholarship...

    The Association of Women in Government established an Educational Foundation to raise money to support scholarship and other education initiatives. The Educational Foundation is a private not-for-profit. Members of the Association of Women in Government periodically make donations to the Educational Foundation. With the exception of the gift described below, these are unrestricted. In December 2016, a donor established a permanent endowment with an initial payment of $100,000 and a pledge to provide $10,000 per year for 3 years, beginning...

  • A and B please You've just turned 40 years old, and you've worked very hard. It's...

    A and B please You've just turned 40 years old, and you've worked very hard. It's paid off. You're both professionally and financially successful, and you'd like to leave a long lasting legacy after you retire. You've decided to fund an infinite stream of college scholarships for under privileged students. More specifically, in order to fund the scholarships, you've decided to make equally sized annual deposits into an investment account that is expected to earn 7% per year, forever. You'll...

  • 1. Your grandmother has invested $4000 in a mutual fund each year on your birthday (she...

    1. Your grandmother has invested $4000 in a mutual fund each year on your birthday (she made her first payment when you turned 1 year old). The mutual fund has grown at an annual interest rate of 6.8%. How much is your account worth on the day of your 21st birthday immediately after your grandmother’s deposit? answer: 2. You set up a college fund in which you pay $4000 each year at the beginning of the year. How much money...

  • 17. SAVINGS ACCOUNTS Linda has joined a Christmas Fund Club at her bank. At the end...

    17. SAVINGS ACCOUNTS Linda has joined a Christmas Fund Club at her bank. At the end of every month, December through October inclusive, she will make a deposit of $40! in her fund. If the money earns interest at the rate of 2.5%/year compounded monthly, how much will she have in her account on December 1 of the following year? 21. INVESTMENT ANALYSIS Luis has $150,000 in his retirement account at his present company. Because he is assuming a position...

  • 1- Your rich aunt wants to finance four years of college for you. Assuming an annual...

    1- Your rich aunt wants to finance four years of college for you. Assuming an annual cost of $19,000, how much money must she put in your college fund now to cover the entire cost of your college education if the fund earns 6% per year. 2- You just bought a used car for $7,000 with no down payment using dealer financing at 5% APR compounded monthly. If you make monthly payments of $500, how many months will it take...

  • Case 2: By the end of each year, you contribute an equal amount of $3,300 per...

    Case 2: By the end of each year, you contribute an equal amount of $3,300 per year to your retirement fund portfolio, which earns an annual nominal return of 11.25% averagely in the long term. The annual contribution continues for 36 years until you retire. (Note: All tax concerns are ignored.) (a) Ignoring the annual inflation. By the time of your retirement, how much nominal money value would you have in your portfolio? (b) Again, ignoring the annual inflation. For...

  • help!! I know this is technically two problems but I ran out of question so please...

    help!! I know this is technically two problems but I ran out of question so please help if you can. I don't have anymore questions left! This problem is similar in spirit to Example 12 (in the chapter) and Problem 15 (at the end of the chapter). I'd strongly suggest that you master those two problems before attempting this problem Make sure that you draw a high quality, detailed timeline - similar in quality to those in Example 12 and...

  • Answer Question 26 (3 points) A grandfather tells his grandson that he has created a trust...

    Answer Question 26 (3 points) A grandfather tells his grandson that he has created a trust fund for him. The terms of the trust are as follows: $9,800 per year for 30 years. The money will be invested in an account that pays 4% annual interest. The payments will start 15 years from today. How much money does the grandfather need to endow the trust with today to fund all the payments? Format $12,345 as 12345 Your Answer: Answer Question...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT