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Your parents invested money in college savings accounts when you and your sister

ID: 3036872 • Letter: Y

Question

Your parents invested money in college savings accounts when you and your sister were born. The balance A (in dollars) of your account after t years can be modeled by A = 3800e0.07t. The graph shows the balance of your sister's account over time. Which account has a greater principal? Which has a greater balance after 10 years?

A.) Your account has a greater principal. Your account has a greater balance after 10 years.

B.) You account has a greater principal. Your sister's account has a greater balance after 10 years.

C.) Your sister's account has a greater principal. Your sister's account has a greater balance after 10 years.

D.) Your sister's account has a greater principal. You account has a greater balance after 10 years.

Your Sister's Account 9000 AA 8000 7000 6000 5000 4000 (0, 4300) 3000 2000 1000 2 4 6 8 10 12 14 16 Year

Explanation / Answer

Principal in sister's account = $ 4300 >$ 3800

After 10 years , balance in my account = 3800 e0.07x10

                                                                                         = 3800 e0.7

                                                             = $7652 (to the nearest integer)

After 10 years , balance in sister's account < $ 7000 (reading from the graph, corresponding to t =10)

                                                                     < $7652

So the correct choice is

D.) Your sister's account has a greater principal. You account has a greater balance after 10 years.