The Alumni Association of Nigara College Is Initiating a One-Year

question 172

Short Answer

The alumni association of Nigara College is initiating a one-year drive to raise money for a perpetual scholarship endowment fund. The goal is to offer ten scholarships per year, each worth $5,000.
a) How large a fund is required to begin awarding the scholarships one year after the funds are in place if the funds can be invested to earn 5% compounded annually in perpetuity?
b) Suppose that, during its fundraising year, the alumni association finds an insurance company that will pay 5.5% compounded annually in perpetuity. How much less money does the association need to raise?
c) What dollar amount in scholarships can be awarded annually if the alumni association raises only $750,000? Use the interest rate from part b.

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Bargaining unit size

Bargaining unit size refers to the number of employees represented by a union or collective bargaining agent, influencing the scope and leverage in negotiations with employers.

Social partnership arrangement

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Stability

The state of being stable, often relating to economic or social conditions that are not subject to sudden changes or volatility.

France

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