Question

Christian has been saving $170 monthly for college. The investment account set up for him has a 3.75% annual interest rate, compounded monthly

If Christian invests $170 monthly over a 4-year period, he will have a total amount of $8,816.47. On average, the annual cost of a 2-year public
institution in the 2020-2021 academic year is $3,900
Would this be enough for Christian to cover the cost of 2 years at a 2-year public institution? If Christian were to save the money without gaining any
interest, approximately how long would it take him to reach $8,816.477
(1 point)
No, $8,316.49 is not enough to cover the cost of 2 years at a 2-year public institution. Without earning interest, it would take Christian approximately 4 years and
4 months to save up $8,816.47.
No, $8,816.49 is not enough to cover the cost of 2 years at a 2-year public institution. Without earning interest, it would take Christian the same 4 years to save
up $3,816.47.
Yes, $8,816.49 is enough to cover the cost of 2 years at a 2-year public institution. Without earning interest, it would take Christian approximately 4 years and 4
months to save up $8,816.47.
O
Yes, $8,816.49 is enough to cover the cost of 2 years at a 2-year public institution. Without earning interest, it would take Christian the same 4 years to save up
$8,816.47.

Answer 1

Based on the available information, and the options provided, the answer is option A. No, $8,816.47 is not enough to cover the cost of 2 years at a 2-year public institution. Without earning interest, it would take Christian approximately 4 years and 4 months to save up $8,816.47.

This is because to cover the cost of 2 years at a 2-year public institution, Christian would need to save $3,900 per year, as stated in the question. Over a 4-year period, the total cost would be $7,800 ($3,900 x 2 years).

However, Christian's savings, with an investment account that has a 3.75% annual interest rate compounded monthly, would accumulate to $8,816.47 over the same 4-year period. This amount is higher than the cost of 2 years at a 2-year public institution.

If Christian were to save the money without gaining any interest, it would take him approximately 4 years and 4 months to reach $8,816.47. This means that even without earning any interest, Christian would still be able to save enough to cover the cost of 2 years at a 2-year public institution.