A financial advisor tells you that you can make your child a millionaire if you just start saving early.You decide to put an equal amount each year into an investment account that earns 7.5% interest per year,starting on the day your child is born.How much would you need to invest each year (rounded to the nearest dollar)to accumulate a million for your child by the time he is 35 years old? (Your last deposit will be made on his 34^th birthday.) A)$6,525 B)$7,910 C)$12,500 D)$20,347

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The correct answer is A.The formula for the future value of an annuity is:FV = PMT * (((1 + r)^n - 1) / r)where:FV is the future valuePMT is the paymentr is the interest raten is the number of periodsIn this case, we have:FV = $1,000,000r = 7.5% = 0.075n = 35Solving for PMT, we get:PMT = FV * (r / ((1 + r)^n - 1))PMT = $1,000,000 * (0.075 / ((1 + 0.075)^35 - 1))PMT = $6,524.68Rounding to the nearest dollar, we get $6,525.

A Financial Advisor Tells You That You Can Make Your