Question

A financial planning service offers a college savings program. The plan calls for you to make six annual payments of $13,000 each, with the first payment occurring today, your child's 12th birthday. Beginning on your child's 18th birthday, the plan will provide $25,000 per year for four years. What return is this investment offering? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Return %

Answer 1

-13000-13000/(1+r)-13000/(1+r)^2-13000/(1+r)^3-13000/(1+r)^4-13000/(1+r)^5+25000/(1+r)^6+25000/(1+r)^7+25000/(1+r)^8+25000/(1+r)^9=0

=>r=5.0523%