02quilici family case
TRANSCRIPT
CASE ANALYSIS : QUILICI FAMILY
BYSANJAY O S
SUSHILKUMAR H BALVIRRAJAN DOSHI
ROHAN MOONKULDIP RPANKAJ
Case analysis : Quilici family• Nuclear family of Greg and Debra and their son Brady.• Greg’s earning is $85000 per annum.• Concerned about Brady’s education whose age is 5 years.• Planning for either Stanford or north Carolina university after
Brady is 18.• Worried about higher education and living expenses at either
of the university.• It is assumed 5% increase in tuition fee and 3% increase in
living expense.• Both are planning to increase their savings for their son’s
future.• For this they met there family financial planner and decided
to invest in mutual fund at assumed 12% annual growth.
I I I I I
1 2 3 4 n-1n-1 n. . .R% R% R%
MONEY FLOW DIAGRAM FOR MONTHLY SAVINGS (FUTURE VALUE)
R%
INFLATED AMOUNT
INFLATED AMOUNT : Ia =
Stanford university:FV=R( PVIF PVIFi,n)
1st year=( FV FV0)=20000* ( PVIF PVIF5%5%,13)+6000* ( PVIF PVIF3%3%,13)
=37713+8811=$46524
2nd year=( FV FV11)=20000* ( PVIF PVIF5%,145%,14)+6000* ( PVIF PVIF3%3%,14)
=39599+9076=$486753rd year= ( FV FV22)=20000*( PVIF PVIF5%5%,15)+6000* ( PVIF PVIF3%3%,15)
=41579+9348=$509274th year= ( FV FV33)=20000*( PVIF PVIF5%5%,16)+6000* (PVIFPVIF3%3%,16)
=43657+9628=$53285
North Carolina:1st year=( FV FV0)=2500* ( PVIF PVIF5%5%,13)+6000* ( PVIF PVIF3%3%,13)
=4714+8811=$13525
2nd year=( FV FV11)=2500* ( PVIF PVIF5%,145%,14)+6000* ( PVIF PVIF3%3%,14)
=4950+9076=$140253rd year= ( FV FV22)=2500*( PVIF PVIF5%5%,15)+6000* ( PVIF PVIF3%3%,15)
=5197+9348=$145454th year= ( FV FV33)=2500*( PVIF PVIF5%5%,16)+6000* ( PVIF PVIF3%3%,16)
=5457+9628=$15085
Question 1
Question 1North Carolina University
Question 1Stanford University
Stanford university:FV=R( PVIF PVIFi,n)
1st year=( FV FV0)=20000* ( PVIF PVIF5%5%,13)+6000* ( PVIF PVIF3%3%,13)
=37713+8811=$46524
2nd year=( FV FV11)=20000* ( PVIF PVIF5%,145%,14)+6000* ( PVIF PVIF3%3%,14)
=39599+9076=$486743rd year= ( FV FV22)=20000*( PVIF PVIF5%5%,15)+6000* ( PVIF PVIF3%3%,15)
=41579+9348=$509264th year= ( FV FV33)=20000*( PVIF PVIF5%5%,16)+6000* (PVIFPVIF3%3%,16)
=43657+9628=$53286
TOTAL EXPENSE=$199410 North Carolina:1st year=( FV FV0)=2500* ( PVIF PVIF5%5%,13)+6000* ( PVIF PVIF3%3%,13)
=4714+8811=$13525
2nd year=( FV FV11)=2500* ( PVIF PVIF5%,145%,14)+6000* ( PVIF PVIF3%3%,14)
=4950+9076=$140253rd year= ( FV FV22)=2500*( PVIF PVIF5%5%,15)+6000* ( PVIF PVIF3%3%,15)
=5197+9348=$145454th year= ( FV FV33)=2500*( PVIF PVIF5%5%,16)+6000* ( PVIF PVIF3%3%,16)
=5457+9628=$15085
TOTAL EXPENCE= $57181
Question 2
CALCULATION FOR MONTHLY SAVINGS
FVAn ==
Where n=155
R = monthly deposit
FVAn = Final Value of Annuity
Question 3: Stanford University
The amount needed at the start of 1st year is $168510. Monthly deposit can be found out by annuity.
FVAn=
168510=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
168510=R(372.21)
R= $452.73 ~ $453 (The amount to be deposited monthly)
Question 3: North Carolina University
The amount needed at the start of 1st year is $48380. Monthly deposit can be found out by annuity.
FVAn=
48380=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
48380=R(372.21)
R= $129.98 ~ $130 (The amount to be deposited monthly)
Question 4: Stanford University
The amount needed at the start of 1st year is $172896. Monthly deposit can be found out by annuity.
FVAn=
172896=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
172896=R(317.95)
R= $543.78 ~ $544 (The amount to be deposited monthly)
Question 4: North Carolina University
The amount needed at the start of 1st year is $49599. Monthly deposit can be found out by annuity.
FVAn=
49599=R[(1.01)155+(1.01)154+….+(1.01)1+(1.01)0]
49599=R(317.95)
R= $155.99 ~ $156 (The amount to be deposited monthly)
Question 5
• North Carolina University:• The amount deposited by the parents for tuition fee and
living expenses is$130*156(months)= $20280Where total tuition fee and living expenses are $57181.
• Stanford University:• The amount deposited by the parents for tuition fee and
living expenses per month is$453*156(months)= $70668Where total tuition fee and living expenses are $199410.
THANK YOU