In two years Rocky plans to enroll at Whatsamatta U., a prestigious university in Frostbite Falls, MN. If the current tuition is $23,500 per year and is expected to increase at a rate of 6% per year, how much will Rocky pay in tuition his first year of school? (His first tuition payment is exactly two years from today.) In his fourth year? (His last tuition payment is exactly 5 years from today) (Rounded to the nearest dollar.)
A) $23,500 and $29,668
B) $26,405 and $29,668
C) $23,500 and $31,448
D) $26,405 and $31,448

Question

Quizplus · Accepted Answer

In two years, the tuition will be $23,500 * (1.06)^2 = $26,405. In five years, the tuition will be $23,500 * (1.06)^5 = $31,448.

In Two Years Rocky Plans to Enroll at Whatsamatta U