mr reid is trying to determine the cost of health care to college students, and the parents ability to cover these cost. He assumes that the cost of one year of health care for college student is $1,000 today. That the average student is 18 when he or she enters college that the inflation in health care cost is rising 10 percent per year, and the parents can save 100 per year to help cover their childrens cost . all payments occur at the end of the relevant period, and the $100/year saving will stop the day the child enters college. Savings can be invested at a nominal rate of 6%, annual compounding. Mr reid wants a health care plan which covers the fully inflated cost of health care for a student for 4 years, during years 19-22. How much would the government have to set aside now ( when a child is born), to supplement the average parents share of a childs college health care cost? The lump sum the government sets aside will also be invested at 6%, annual compounding.