As rates increases or decreases, the discount rate that is used also changes appropriately.
He starts saving $ in January to buy a gift in June. (which is 6 months, or 5 months not including June)
Each month he saves 2/3 of his allowance, which is $14.
[his allowance each month is $21, 2/3 of his allowance is $14]
(you multiply 21 by 2/3 = 42/3 = 14)
The gift he wants to buy is $110
x = the number of months
y = total cost
14x = y
14x = 110 [he saves $14 each month, he wants to have a total of $110 to buy a gift]
Plug in 6 for x in the equation
14(6) = 110
84 = 110 (He is $26 short, so saving either for 5 or 6 months will not get Ian $110)
Ian will not have enough money because he is $26 short for 6 months or $40 short for 5 months. (you can decide whether you want to go by 5 months or 6(including June), sorry for the confusing answer)
Step-by-step explanation:
Money in the beginning: 400$.
Money after the first raise: 400$+5%*400$=420$
5%*400= 5*400/100=20$
The second raise is applied on the money AFTER THE FIRST RAISE.
420$+6%*420=445.2$
6%*420= 420*6/100 = 25.2$
