Ruby is expecting her first child next month and would like to have $80 000 saved for university education when the child turns 17.If Ruby can get a 6.6 percent annual return on the education savings for her child,how much does she need to start saving each month once the baby is born?
A)$2688
B)$392
C)$224
D)$218

Question

Quizplus · Accepted Answer

To find the monthly savings needed, we use the future value of an annuity formula. Given the future value ($80,000), the annual interest rate (6.6%), and the time period (17 years), we calculate the monthly savings amount. The correct calculation results in approximately $218 per month.

Ruby Is Expecting Her First Child Next Month and Would