a father is planning a savings program to put his daughter through college. his daughter is now 13 years old. she plans to enroll the university in five years from now, and it should take her four years to complete her education. currently, cost per year (for everything - food, clothing - tuition , books, transportation and so forth) is $12,500, but a five percent inflation rate in these costs is forecasted. the daughter recently received $7,500 from her fat her as donation for education, and will be deposited into an account paying 8% compounded annually. the rest of the costs will be met by the money father will deposit in the same account, also earning 8%. father will deposit first saving today and until sh e starts to university, 6 equal deposits. his savings should help cover all university costs and will be totally exhausted after the last year. what is the amount of six equal deposits that will be made by the father?

Suppose that a major city’s main thoroughfare, which is also an interstate highway, will be completely closed to traffic for two years, from january 2014 to december 2015, for reconstruction at a cost of $535 million. if the construction company were to keep the highway open for traffic during construction, the highway reconstruction project would take much longer and be more expensive. suppose that construction would take four years if the highway were kept open, at a total cost of $800 million. the state department of transportation had to make its decision in 2014, one year before the start of construction (so that the first payment was one year away). so the department of transportation had the following choices: (i) close the highway during construction, at an annual cost of $267.5 million per year for two years. (ii) keep the highway open during construction, at an annual cost of $200 million per year for four years. now suppose the interest rate is 80%. calculate the present value of the costs incurred under each plan.