Your younger sister, Linda, will start college in five years. She has just informed your parents that she wants to go to Hampton University, which will cost $34,000 per year for four years (cost assumed to come at the end of each year). Anticipating Linda’s ambitions, your parents started investing $5,400 per year five years ago and will continue to do so for five more years. Use 12 percent as the appropriate interest rate throughout this problem (for discounting or compounding).
How much will your parents have to save each year for the next five years in addition to the $5,400 they are currently saving to have the necessary funds for Linda's education? Use Appendix C and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)