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Q5.26: Vijay needs $10,000. He currently has $8,000 and wants to invest it in whatever way lets him reach $10,000 as quickly as possible. Vijay
Q5.26: Vijay needs $10,000. He currently has $8,000 and wants to invest it in whatever way lets him reach $10,000 as quickly as possible. Vijay has narrowed his choices down to two options. With Option A, he would put all $8,000 into one account that pays 5% annual interest. With Option B, he would split the money between two accounts, each of which has a beginning balance of $4,000 and pays 5.5% annual interest. Which option best fits Vijay's goals? A The two options are equally preferable, because they will take nearly the same amount of time to reach a total balance of $10,000. B Neither option is a good fit, because both take over four years to reach a total balance of $10,000. C Option B is a better fit, because the higher interest rates mean he will reach $10,000 faster than with Option A. D Option A is a better fit, because the higher initial account balance means he will reach $10,000 faster than with Option B
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