...investing in their children’s college funds. There are a number of ways to invest one’s money and that includes stock trading, mutual funds, cash bonds, and time deposits, among others.
For the problem at hand, Grandma has $50,000 to invest for Kid’s college education. After some careful planning, she decided to invest her money in a Saving Bond which offers a fixed annual interest rate of .60%, compounded semi-annually, and will mature after 20 years, the same time at which Kid will be going to college (Series EE Savings Bonds Info, 2011... ). By computing the value of Grandma’s investment after 20 years, this will result in the following:
F(t) = P(1 + r/n)^nt
where F =...