Final Answer:
Jerome should ask his parents for approximately $6,300.47 now to ensure he has enough to buy the car in 3 years, assuming an interest rate of 10% compounded continuously.
Step-by-step explanation:
To determine how much money Jerome needs to ask his parents for, we can use the formula for compound interest continuously compounded: A = P * e^(rt), where:
A is the future value (in this case, $8,000),
P is the principal (the amount Jerome needs now),
r is the interest rate (10% or 0.10), and
t is the time in years (3).
Rearranging the formula to solve for P, we get P = A / e^(rt). Substituting the known values, we find P = 8000 / e^(0.10 * 3) ≈ $6,300.47.
Therefore, to ensure Jerome has $8,000 in 3 years, he should ask his parents for approximately $6,300.47 now, assuming an interest rate of 10% compounded continuously. This calculation ensures that the investment grows to the desired future value by considering the continuous compounding of interest over the given period.