# Question Time Money Value

Carlos plans to start studying a master’s degree that begins in 3 years. Payments consist of 4 installments of \$ 8000 at the beginning of each semester. How much does Carlos have to deposit at the end of each month in a savings account that pays him an effective annual interest rate of 4% in order to pay for his studies?
a. \$ 839
b. \$ 889
c. \$ 917

I can’t understand the problem and it doesn’t come out, please I need help

I don’t follow the semester part: is it 2 semesters/year at times x.0 and x.5? How many years, etc. etc.???

If I don’t discount the actual tuition payments, i.e. I need exactly \$32,000 at time 3, I get 839 as the monthly deposit:

P/Y=12 C/Y=1
2nd CLR TVM
36 N I 4 FV 32000 CPT PMT -838.9902056

Even if we discount the tuition payments, the monthly deposit will be LOWER!!!

thank you so much, yeah I know that if you discount PMT will be lower, but wouldnt be answer. A question brother, you mean to I/Y = 4 /12 =0.333 right? In that cast I get pmt = 838.1058.?

The questions says effective annual rate of 4%, which I interpret as 1 compounding per year. I could go through the rigmarole of calculating the equivalent monthly rate (3.92848) and set C/Y to 12, but I will still get 838.99.

I see, but now I realized the answer is the c.
I do not know whats going on

Please my friend can you help me with this question:

You’re not the only one. I infer that the printed answer, c (\$917), is a typographical error. Did the Institute get it wrong?

Thoughts, anyone?

fv=32000 N=3*12 I/Y=4/12 cpt PMT=838.10085

probably from
but if thats really the process, i dont agree with how 32000 isnt discounted, and instead of 36, it should be 35, of course the answer will be very different