1. In 4 years, your son will be entering college and you would like to help financially. You decide to create a college fund and make four annual deposits, starting now. In four years, you would like your son to be able to make four annual withdrawals of $7,500 from the fund (at the beginning of each year) that will cover his annual tuition. If the college fund earns 3.6% compounded annually, how much must you deposit at the beginning of each year? Assume tuition remains the same for the four years your son is attending college.
$6,510.62
$7,040.19
$28,472.20
$25,800.00
2. Jennifer just turned 23 and can save $500 per quarter, starting in three months. If Jennifer can earn 7% compounded quarterly, what age will she be when she accumulates $1,000,000?
74 years old
57 years old
51 years old
206 years old