You have an absolutely brilliant child who is six years old and will be attending a private college in twelve years. You know that a four -year college now costs at least $30,000 per year, including tuition, books, and room and board. The cost of sending a child to college has increased by 7 percent per year, and you believe this will be true for the next twelve years. How much will the annual tuition be when your child is eighteen?
A) 2.2522
B) 2.2107
C) 2.0122
D) 1.5007

Question

Quizplus · Accepted Answer

The correct answer is A because the annual tuition will be $78,583.20 when the child is eighteen. This is calculated by multiplying the current cost of $30,000 by (1 + 0.07)^12, which equals 2.2522.

You Have an Absolutely Brilliant Child Who Is Six Years