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Your five-year-old daughter has just announced that she would like to attend college. The College Board has

reported that the average annual cost of tuition, room, and board, and other expenses at public four-year colleges is

$21,500 in 2023 (to be paid at the beginning of 2023). The cost has risen 3.5% over the last year. You feel this

percentage increase is a good long-term estimate. You also believe that you can earn a rate of 7% compounded

annually on investments to meet this goal./nD.

If you were to invest a lump sum today in hopes of covering your daughter's college costs, how

much would you have to invest? Assume you can only come up with 80% of this value. What is the

maximum you can afford to spend on your daughter's four-year college education.

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