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December 27, 2014

December 27, 2014

Posted by **tracy** on Monday, October 24, 2011 at 9:03pm.

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Option A: Your money would receive simple interest at the end of 5 years.

The formula is A = 1000 + 1000(0.05) x.

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Option B: Your money will be compounded continuously.

The formula is A = (1000)(2.71828)(0.05 x).

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Option C: You will invest in a CD (Certificate of Deposit) compounded yearly.

The formula is A = (1000)(1.05) x.

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Option D: Buy a US Savings Bond. Buy at $1000 now.

When cashed in 5 years later, the amount will be $1267.

Calculate each of these. You can find this by substituting x = 5 in each formula. Note that there is no formula in the US Savings Bonds option, just the amount.

Post a response with your answers to the following questions.

1. What is the order of Options A, B, C, and D, listing the option which gives the greatest amount at the end of 5 years to the least?

2. Which option gave you the greatest amount at the end of the five years?

3. What was the amount you calculated with this option?

- math -
**tracy**, Monday, October 24, 2011 at 9:22pmI figured it out

1. BCDA

2. B gave the greatest amount

3. $1284

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