Multi-Part Question

Suppose you saving to take a trip to Cuba 30 months from now. To pay for the trip, you will either (a) put $2,500 in an account that pays 6% annual interest, or (b) save $100 each month (in the same account that returns 6% per year). Assume monthly compounding in both cases.

11. How much will you have for your trip if you choose option (a)?

11. How much will you have for your trip if you choose option (b)?

11. What is the difference between $10,000 invested for ten years at 4% per year, compounded annually, and at 7% per year, compounded semi-annually?