Question

You want to begin saving for your daughter’s education and you estimate that she will need $65,000 in 17 years. If you can earn 6% per year, how much do you need to invest today? a. $15,197.34 b. $38,487.88 c. $24,138.69 d. $31,093.81

Answer 1

P(1.06¹⁷) = $65,000

P = $65,000/1.06¹⁷ = $24,138.69

The correct answer is C.