Newborn baby Gregory, born today, has doting grandparents who want to start saving for his college education. They calculate that he will need $25,000 per year for 4 years beginning at age 18. In addition, they'd like to give him a lump sum of $50,000 at age 22 so he can buy a car for his graduation. They want to make 18 equal annual payments into a 10% interest-paying account (starting today and ending on Gregory's 17th birthday) that will just cover these plans.
Required:
- How much will he need on day one when he begins college
- How much will they need to invest each year?