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question 59

Essay

Use the information for the question(s)below.
Suppose that a young couple has just had their first baby,a daughter,and they wish to ensure that enough money will be available to pay for her college education.Currently,college tuition,books,fees,and other costs,average $12,500 per year.On average,tuition and other costs have historically increased at a rate of 4% per year.
-Assuming that college costs continue to increase an average of 4% per year and that all her college savings are invested in an account paying 7% interest,then the amount of money she will need to have available at age 18 to pay for all four years of her undergraduate education is closest to:

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Definitions:

Acronym

A word formed from the initial letters or groups of letters of words in a phrase or series of words, used as an abbreviation (e.g., NASA, scuba).

Hum

A low, steady, continuous sound often produced by machinery, electronic devices, or by a group of similar sounds blending together.

Misinformation Effect Paradigm

A phenomenon in which a person's recall of an event becomes less accurate due to the introduction of misleading information.

Deese-Roediger-McDermott

A phenomenon in cognitive psychology where people falsely remember words related to those they have actually heard.