In​ March, a family starts saving for a vacation they are planning for the end of August. The family expects the vacation to cost ​$1327.

Question

In​ March, a family starts saving for a vacation they are planning for the end of August. The family expects the vacation to cost ​$1327. They start with ​$120. At the beginning of each month, they plan to deposit 20​% more than the previous month. Will they have enough money for their​ trip? If​ not, how much more do they​ need?

Answer 1

Most savings plan formulas assume a constant monthly payment, but in this case the payments increase by 20% each month. Nothing is said about interest - are they putting the money under a mattress? Easiest way to figure it is just to make table, as only a few months are involved:

Time Deposit

Beg. March $120

Beg. April 144

Beg. May 172.80

Beg. June 207.36

Beg. July 248.83

Beg. Aug. 298.60

Total $1,191.59 Looks like they'll need another $135.41.

Waiting to see a more sophisticated math approach.