Assume you are working with the foundation to fund a scholarship in your name. Currently, the foundation can earn a 5 percent return on any donations. A. How much money would you need to donate to fund a scholarship that pays $25,000 every year forever, starting one year from now? B. How much money would you need to donate if the foundation could increase their return to 7 percent on any
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- You want to endow a scholarship that will pay $11,000 per year forever, starting one year from now. If the school’s endowment discount rate is 6%, what amount must you donate to endow the scholarship?Determine the amount of money required to set up a charitable endowment that pays the amount P each year indefinitely for the annual interest rate r compounded continuously. P = $13,000, r = 6% STEP 1: We start with the present value of a perpetuity, which is defined as follows. Present value = P r Here, represents the size of each annual payment in dollars, and represents the annual interest rate. STEP 2: Calculate the present value. (Round your answer to two decimal places.)You want to endow a scholarship that will pay $12,000 per year forever, starting one year from now. If the school's endowment discount rate is 5%, what amount must you donate to endow the scholarship?
- Mr. Crabapple wants to donate money now for an account that will allow a favored charity to make $17,000 withdrawals at the end of each of years 19 to 44. How much should he contribute today if investment managers Dogwood Associates expect to earn returns averaging 4.3% per year on the charity's foundation account? (This is a 26-year deferred annuity, with $17,000 to be paid out at the end of each of years 19 to 44.) A. $128,584.54 B. $115,644.17 C $263,040.12 D. $123,283.36 E. $156,230.80Don Solomon wants to set up a scholarship program with his alma mater. If P941498 is needed per year for the scholars, how much must he invest today at 1.7% compounded annually to fund the scholarship program in perpetuity? Round your answer to 2 decimal places.You want to endow a scholarship that will pay $11,000-per year forever, starting one year from now. If the school's endowment discount rate is 9%, what amount must you donate to endow the scholarship? The amount you must donate is $_______. (Round to the nearest cent.)
- You want to endow a scholarship that will pay $7,000 per year forever, starting one year from now. If the school's endowment discount rate is 5%, what amount must you donate to endow the scholarship? The amount you must donate is $ (Round to the nearest cent.)Hal wants to establish a savings fund from which a community organization could draw $890 a year for 20 years. If the account earns 2.5 percent annual interest, what amount does he have to deposit now to achieve this goal? Use Exhibit 1B-4. (Round time value factors to 3 decimal places and final answer to the nearest dollar amount. Omit the "$" sign in your response.) Amount to be deposited $You would like to establish a fund that will be used to offer a scholarship each year to a worthy student at your alma mater. You would like the total annual award to be $5,000, with the first award to be presented today. Your alma mater is able to invest the funds at a constant, annual, tax - free rate of 8%. How much must you donate today to fund this award? Round your answer to the nearest dollar. You would like to establish a fund that will be used to offer a scholarship each year to a worthy student at your alma mater. You would like the total annual award to be $5,000, with the first award to be presented today. Your alma mater is able to invest the funds at a constant, annual, tax - free rate of 8%. How much must you donate today to fund this award? Round your answer to the nearest dollar. $67, 500 $51,296 $46,296 $62, 500
- Emma wants to donate $1,000,000 to establish a fund to provide an annual scholarship in perpetuity. The fund will earn an interest rate of j4=4.12% p.a. effective and the first scholarship will be first awarded 2.5 years after the date of the donation. (a) What is the amount of the annual scholarship (rounded to two decimal places)? (b) Assume that the fund's earnings rate rate has changed from j4=4.12% to j4 = 3.87% one year before the first scholarship payment. How much does Emma need to add to the fund at that time (one year before the first scholarship payment) to ensure that scholarship amount will be unchanged (rounded to two decimal places)? (a) What is the amount of the annual scholarship (rounded to two decimal places)? a. 44494.20 b. 46355.87 C. 41840.92 d. 43772.21 (b) Assume that the fund's earnings rate rate has changed from 4-4.12% to 4-3.87% one year before the first scholarship payment. How much does Emma need to add to the fund at that time (one year before the first…You decided to fund a charity for ten years. The first payment will be made one year from today (at the end of year one) and will be $8,350. Each year after that, the charity will receive payment from you annually. The payment will increase at a rate of 2% per year after the second payment. If the annual interest rate is 15%, what is the present value of this endowment? no excel and calculations pleaseEmma wants to donate $1,000,000 to establish a fund to provide an annual scholarship in perpetuity. The fund will earn an interest rate of j4=5% p.a. effective and the first scholarship will be first awarded 2.5 years after the date of the donation. (b) Assume that the fund's earnings rate rate has changed from j4=5% to j4=4.75% one year before the first scholarship payment. How much does Emma need to add to the fund at that time (one year before the first scholarship payment) to ensure that scholarship amount will be unchanged (rounded to two decimal places)?