Franklin Templeton has just invested $10,760 for his son (age one). This money w

Question

Franklin Templeton has just invested $10,760 for his son (age one). This money will be used for his son’s education 17 years from now. He calculates that he will need $54,343 by the time the boy goes to school.

What rate of return will Mr. Templeton need in order to achieve this goal? Use Appendix B for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

What rate of return will Mr. Templeton need in order to achieve this goal? Use Appendix B for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Explanation / Answer

Future Value=(1+r)raise to n*Present Value (1+r)raise to 17*10760=54343 (1+r)raise to 17=54343/10760 (1+r)raise to 17=5.050465 Checking the Table (1+r)raise to n r=10

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