Question

Elwood invested $5,000 in a money market account and has been tracking its progress. He found that after 3 years, the account held $7,100 and after 8 years, the account held $10,350. Use this information to complete the statements. Over the first 3 years, the value of the account increased at ___ over the last 5 years. Over the entire 8 years, the value of the account increased at an average rate of approximately $___ annually.

Answer 1

Answer:

drop down 1 a slower rate per year

drop down 2 670

Step-by-step explanation:

as in three years you get $7100

you take that and subtract it by your starting amount (5000)

7100-5000= 2100

then divide 2100 by the number of years (3)

to get your annual rate of 700$

then you take the 8 year total and subtract it from your 3 year total

10350-7100= 3250

Then divide that by 5 because that how many years it has been

to get the annual rate of 650

making the 5 year rate slower.

The to find the average rate over all 8 year you take 10350 and subtract it from your starting number 5000

10350-5000= 5350

then take 5350 and divide it by the number of years (8)

you then get you average rate of 668.75

668.75=670

Hope this helps!

Answer 2

Answer:

Given:

Principal= $5,000

After 3 years, Amount= $7,100

After 8 years, Amount= $10,350

Step-by-step explanation:

Interest after 3 years= $7,100- $5,000

                                   =$2,100

Interest in last 5 years= $10,350- $7,100

                                    =$ 3,250

Difference between first 3 years and last 5 years= $3,250- $2,100

                                                                                 =$1,150

Amount= Principal*$(1+r/100)^{t}$

10,350=5000$(1+r/100)^{8}$

$\frac{10350}{5000}$=$(1+r/100)^{8}$

2.07=$(1+r/100)^{8}$

$2.07^{1/8}$=1+$\frac{r}{100}$

1.095-1=$\frac{r}{100}$

0.095*100=r

r=9.5%

Average rate=$\frac{5000*9.5*1}{100}$

                    =$475