Question

The Greens want to put an addition on their house 18 months from now. They will need to save $10,620 in order to achieve this goal. They set aside the same amount each month, and after a year discover they have saved $6,120. The Greens must adjust their plan in order to meet their goal, so they came up with the following options:
Option A: Stay with saving the original amount each month but put the addition on one month later than originally planned.
Option B: Increase the amount of money they save each month by $120 from their original plan.
Which of the following statements is true?
a.
Only option A will allow them to meet their goal.
b.
Only option B will allow them to meet their goal.
c.
Both options A and B will allow them to meet their goal.
d.
Neither option A nor option B will allow them to meet their goal.

Answer 1

Amount saved using option A = 6120/12 x 19 = $9,690

Amount saved using option B = 6120 + 6(6120/12 + 120) = 6,120 + 6(510 + 120) = 6120 + 6(630) = 6120 + 3780 = $9,900

Neither option A nor option B will allow them to meet their goal.