Your son is about to start kindergarten in a private school.Currently,the tuition is $12,000 per year,payable at the start of the school year.You expect annual tuition increases to average 6% per year over the next 13 years.Assuming that you son remains in this private school through high school and that your current interest rate is 7%,then the present value of your son's private school education is closest to:
A)$332,300
B)$137,900
C)$155,800
D)$156,000

Question

Quizplus · Accepted Answer

B)$12,000 × 11ea7cce_3be1_75b1_928c_ad26b6d62744_TB1626_11 11ea7cce_3be1_75b2_928c_29c59fd513d4_TB1626_11 = $137,893

Your Son Is About to Start Kindergarten in a Private