Eighteen Years from Now,4 Years of College Are Expected to Cost

question 44

Multiple Choice

Eighteen years from now,4 years of college are expected to cost $150,000.How much more must be deposited into an account today to fund this expense if you can earn only 8% on your savings rather than the 11% you hope to earn?

• A) $12,211.18
• B) $13,609.21
• C) $14,006.41
• D) $14,614.03

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Definitions:

Debt

An amount of money borrowed by one party from another, under the condition that it is to be repaid at a later date, usually with interest.

Equity

The owner's interest in an asset or business, representing the residual value after liabilities are deducted from assets.

Financial Manager

A professional responsible for the financial health of a corporation, overseeing investment activities, and planning strategies for long-term financial goals.

Value Of Shares

The worth of a company's shares on the market, influenced by its financial performance, investor perceptions, and market conditions.