A Trust Fund for a Child's Education Is Being Set

question 50

Short Answer

A trust fund for a child's education is being set up by a single payment so that at the end of 17 years there will be $31,000.If the fund earns interest at the rate of 8.25% compounded monthly,how much money should be paid into the fund initially?

Recognize the strategies management and labor unions can implement for effective collective bargaining.

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Recognize the impact of managed care systems on mental health treatment.

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Definitions:

Interest Payment

The amount paid at intervals by the borrower to the lender for the use of borrowed money, typically expressed as a percentage of the principal.

Simple Interest

Interest calculated only on the principal amount, or on that portion of the principal amount that remains unpaid.

Months

Units of time used in accounting and financial contexts to represent periods or durations, often for reporting, planning, or measurement purposes.

Promissory Note

A financial instrument that contains a written promise by one party to pay another party a definite sum of money either on demand or at a specified future date.