Use the information for the question(s)below.
Suppose that a young couple has just had their first baby,a daughter,and they wish to ensure that enough money will be available to pay for her college education.Currently,college tuition,books,fees,and other costs,average $12,500 per year.On average,tuition and other costs have historically increased at a rate of 4% per year.
-Assuming that college costs continue to increase an average of 4% per year and that all her college savings are invested in an account paying 7% interest,then the amount of money she will need to have available at age 18 to pay for all four years of her undergraduate education is closest to:
A)$97,110.
B)$107,532.
C)$101,291.
D)$50,000.

Question

Quizplus · Accepted Answer

The correct answer is A because the amount of money she will need to have available at age 18 to pay for all four years of her undergraduate education is closest to $97,110.

Use the Information for the Question(s)below