Question

1. The cost of attending college has been rising at an average increase of 7% for the past ten

years. How much will a college that now costs $10,368 for room, board, tuition and fees cost

two years from now?

Answer 1

Answer: $11,870.32

Explanation:

Use a compound interest formula for this as it shows what happens when when something increases at a certain rate per period.

= Amount * ( 1 + rate) ^ no. of periods

= 10,368 * ( 1 + 7%) ²

= 10,368 * 1.1449

= $11,870.3232

= $11,870.32