Michelle's balance after 8 years is $10,790.48.
Kristen's balance after 8 years is $3,770.55.
Gabriella's balance after 8 years is $24,780.42.
Judy's balance after 8 years is $3618.62.
The person with the most money at the end of the 8 years is Gabriella. If I were to choose one of the options, I would choose Gabriella's option
What is Michelle's balance after 8 years?
The formula that can be used to determine the future value of an amount 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 monthly compounding = $2000 x ( 1 + 0.035/12)^(12 x 8) = $2645.18
Future value with continuous compounding = : A x e^r x N
- A= amount
- e = 2.7182818
- N = number of years
- r = interest rate
1000 x e^0.018 x 8 = $8,145.30
Total = $8,145.30 + $2645.18 = $10,790.48
What is Kristen's balance after 8 years?
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
What is Gabriella's balance after 8 years?
$3000 x e^0.032 x 8 = $24,780.42
What is Judy's balance after 8 years?
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: https://brainly.com/question/18760477
