Mary Kay has a child who will start college in 10 years. She plans to set aside $2,400 per year for her child's education during this period and estimates she will earn an annual rate of 8%. How much will Mary Kay have available for her child's education in 10 years?
A) $24,000
B) $27,446
C) $34,769
D) $29,971

Question

Quizplus · Accepted Answer

Mary Kay is making a series of equal annual investments to save for her child's education, which is a scenario that can be calculated using the future value of an annuity formula. Given an annual investment of $2,400, an interest rate of 8%, and a period of 10 years, the future value of this annuity can be calculated. The correct calculation leads to a future value of approximately $34,769, making option C the correct answer.

Mary Kay Has a Child Who Will Start College in 10