Olivia S.

Trip to Peru algebra question

1. You are planning to go on this trip in 2 years.  How much money will you need to invest at a 2.3% interest rate compounded annually in order to have $2400 in 2 years? Use the compound interest formula A = P (1 + i)n. (Round final answer to the nearest cent, but otherwise don’t round any intermediate values) - Is the answer$220.39?

2. Now say you only have $1600 to invest and the highest interest rate you can find is 3.55% compounded annually. If you decide to wait 7 years to go on the trip, how much money will you have to spend on the trip? Use the compound interest formula A = P (1 + i)n. (Round final answer to the nearest cent, but otherwise don’t round any intermediate values) - Is the answer$64,595,127.42?

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BS Mathematics, MD

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