Suppose you wish to create a scholarship fund which will pay 73.43 each year for the next 14 years. If you accomplish your task by depositing a single amount today into a bank account which pays 12.91% per year, what must the deposit amount be? (Accuracy is at the second decimal.)

To determine the deposit amount needed to create a scholarship fund that will pay $73.43 each year for the next 14 years, we can use the concept of present value.

The present value formula can be used to calculate the current value of future cash flows, taking into account the interest rate and time period. The formula for present value (PV) is:

PV = CF / (1 + r)^n

Where:
PV is the present value (current value)
CF is the future cash flow (annual payment)
r is the interest rate per period
n is the number of periods

In this case, the annual payment is $73.43, the interest rate is 12.91% (converted to a decimal, it is 0.1291), and the number of periods is 14.

To find the deposit amount, we need to solve for PV in the present value formula:

PV = $73.43 / (1 + 0.1291)^14

Calculating the value inside the parentheses:

1 + 0.1291 = 1.1291

Now raise this value to the power of 14:

(1.1291)^14 ≈ 4.8664

Now, divide the annual payment by 4.8664:

$73.43 / 4.8664 ≈ $15.10

Therefore, the deposit amount needed today to create a scholarship fund that will pay $73.43 each year for the next 14 years at an interest rate of 12.91% is approximately $15.10.