The assignment is to run a simulation on excel to figure out the probabilities on obtaining a certain goal:
John and Jane Doe are planning to save money to pay a house for their 6-month-old son, Patrick. They have decided that they would like to have $500,000 saved by the time Patrick is ready for college 17 years from today:
John and Jane are planning to save $20,000 (at the beginning of) each year (ignore taxes). Assume that the return each year varies and is sampled from the same normal distribution (mean rate of return is 4%, standard deviation is also 10%, i.e. one standard deviation away is either a -6% return or an 14% return). (Hence in each trial there are 17 different rates of return, one for each year.) Run a simulation of this investment strategy with at least 1000 trials.
Here's my attempt on the problem (click on the photo to reveal a larger version):
I am not to sure on how to continue from there. Am I missing other components to solve the problem? Is 'n' the number of trials? Any advice would be appreciated!