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Suppose that you are planning to pay for your child’s college tuition. Your child was just...

Suppose that you are planning to pay for your child’s college tuition. Your child was just born, and all-four- years of college tuition for your child will be due exactly on the child’s 18 th birthday (i.e. all payments at end of year 17). You think for the first 8 years you can afford to set aside $4,000 per year (with the first deposit being made at the end of the first year). How much will you have to save in years 9 through 17 so that you have exactly $400,000 saved up for college tuition payments at the end of year 17? Assume that the annual discount rate is 7%.

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