Having Received a Large Inheritance, a Child's Parents Wish to Establish

question 203

Multiple Choice

Having received a large inheritance, a child's parents wish to establish a trust for the child's college education. If 7 year(s) from now they need an estimated $60,000, how much should they set aside in trust now, if they invest the money at the given rate of interest. Round your answer to the nearest cent. ​
13) 5% compounded quarterly _________
​
13) 5% compounded continuously _________
​

• A) $23,444.14, $24,043.68
• B) $23,687.36, $23,320.77
• C) $23,320.77, $23,444.14
• D) $23,687.36, $23,444.14

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Definitions:

Investing More Effort

The action of dedicating additional energy and resources towards achieving a task or goal.

Equal Work

The principle that individuals should receive equal treatment and opportunities in the workplace, regardless of personal characteristics unrelated to their job performance.

Equal Outcomes

Describes a scenario where all participants or entities achieve the same results, regardless of differences in effort, skill, or starting conditions.

Distributive Justice

The perceived fairness of the distribution of resources or rewards among individuals in a group or organization.