Mrs Galicia gave her sisters $3000 each to invest. The investment will last 8 years. The table shows what each sister did with t

Question

3 years ago

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Mrs Galicia gave her sisters $3000 each to invest. The investment will last 8 years. The table shows what each sister did with t

heir investment and how it changed over 8 years. Use the chart to answer the following questions please
1. What is the balance of Michelle's $3000 after 8 years?

2. What is the balance of Kristen's $3000 after 8 years?

3. What is the balance of Gabriella's $3000 after 8 years?

4. What is the balance of Judy's $3000 after 8 years?

5. Who has the most money at the end of the 8 years? If i were to choose one of the options to use for my own money, which option should I choose?

Mathematics

1 answer:

Vilka [71] · Answer 1 · 2022-10-01T19:45:42+03:00

Michelle's investment balance after 8 years is $10,790.48.

Kristen's investment balance after 8 years is $3,770.55.

Gabriella's investment balance after 8 years is $24,780.42.

Judy's investment balance after 8 years is $3618.62.

The person with the highest amount of money at the end of the 8 years is Gabriella. If I were to choose one of the investment options, I would choose Gabriella's option.

<h3>What are the formulas that can be used to determine the balance of the sisters?</h3>

The formula that can be used to determine the future value of the investment with compounding is:

FV = P (1 + r)^nm

Where:

FV = Future value
P = Present value
R = interest rate / number of compounding
m = number of compounding
N = number of years

Future value with continuous compounding = : A x e^r x N

Where:

A= amount
e = 2.7182818
N = number of years
r = interest rate

<h3>What is Michelle's balance after 8 years?</h3>

Future value with monthly compounding = $2000 x ( 1 + 0.035/12)^(12 x 8) = $2645.18

Future value with continuous compounding: 1000 x e^0.018 x 8 = $8,145.30

Total = $8,145.30 + $2645.18 = $10,790.48

<h3>What is Kristen's balance after 8 years?</h3>

Future value with quarterly compounding = 2500 x (1 + 0.012 / 4)^(4 x 8) = $2,751.50

Future value with quarterly compounding = 500 (1 .0225)^(8x4) = $1019.05

Total = $3,770.55

<h3>What is Gabriella's balance after 8 years?</h3>

$3000 x e^0.032 x 8 = $24,780.42

<h3>What is Judy's balance after 8 years?</h3>

Future value with exponential increase = 1050 x (1.015)^8 = $1,182.82

Future value with biannual compounding = 1950 x (1 + 0.028/2)^(8 x 2) = $2435.80

Total = $3618.62

To learn more about future value, please check: brainly.com/question/18760477