Question
Situation: Suppose you receive a 25-year inheritance of $ 15,000 and decide to put it in a savings account at Banco Cortigo to earn interest.
Situation: Suppose you receive a 25-year inheritance of $ 15,000 and decide to put it in a savings account at Banco Cortigo to earn interest. Banco Cortigo guides you about Certificate of Deposit 5 (CD5) where interest is generated at an annual interest rate of 2% compounded semi-annually. You liked the idea and made a deposit of $ 15,000 on that CD5. A. Supposing that, when you turn 45, you want to withdraw all the money in that account to use it to pay your child for a Bachelor of Science in Biology at university. Assuming that the BA in Biology will cost approximately $ 26,000 in total by then, calculate the total amount of money in the account that you will have at age 45. Also, figure out how much money you would need to pay for a bachelor's degree in biology in college. Round the results to two decimal places B. Calculate how much money you need to deposit now at age 25 so that by the time you turn 45 you will have enough money to pay your child for a Bachelor of Biology in college. Round the results to two decimal places C. Explain in a paragraph or two your reasoning for the exponential function to model the total amount of money in the account after t years. In addition, explain your rationale for identifying the amount of money that was missing from the account at age 45 to pay for your son's bachelor's degree in biology in college. Finally, explain your rationale for determining the minimum amount of money deposited at age 25 so that by the time you turn 45 you will have enough money to pay your child for a Bachelor of Science in Biology in college.
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