“Cash Flows College Tuition Calculation (Topic 5 #12)You have a son who is 5 years old. You want to provide financial help when he goes to college in exactly 13 years. You are planning to give him $20,000 a year at the beginning of each year for 4 years to pay his educational expenses. How much do you have to set aside today if you can earn an annual rate of 5% on all invested funds?”

“Cash Flows College Tuition Calculation (Topic 5 #12)You have a son who is 5 years old. You want to provide financial help when he goes to college in exactly 13 years. You are planning to give him $20,000 a year at the beginning of each year for 4 years to pay his educational expenses. How much do you have to set aside today if you can earn an annual rate of 5% on all invested funds?”

Step 1. Calculate the amount needed in future (USE BEGIN MODE).Step 2. Calculate value today as the present value of the amount needed in future.