Question

You are saving for a bicycle that costs $120. You Deposit $75 in an account that earns compounded annually. The Expression 75(1+r)^2 represents the balance after 2 years the annual interest rate in decimal form.

A. Write a polynomial that represents the balance of your account.
B. What is the balance of your account when the interest rate is 10%.
C. How much more money do you need to buy the bicycle?

Answer 1

A. Expanding the given expression, you have
balance = 75r^2 +150r +75

B. For r=0.10, the balance after 2 years is 75*1.1^2 = 90.75

C. The difference between $120 and 90.75 is $29.25. You need $29.25 more to buy the bicycle.