Giselle used the table to predict the cost of one year of college.
| Category | Estimated Cost 2017-2018 |
| :------- | :----------------------- |
| tuition | $12,450 |
| room and board | $10,125 |
| transportation | $2,600 |
| books and fees | $2,250 |
| other | $1,250 |
Giselle predicts that she will receive a grant for $4,000. If she has 4 years in which to save, what is the minimum monthly amount she should deposit in an interest bearing savings account to be able to pay her contribution for one year of college?
A. $400
B. $500
C. $600
D. $700
Answer (2)
Calculate the total cost of college: $12450 + 10125 + 2600 + 2250 + 1250 = $28675.
Subtract the grant: $28675 - 4000 = $24675.
Calculate the total months to save: 4 × 12 = 48 months.
Divide the remaining cost by the number of months: $\frac{24675}{48} = 514.0625 . The closest option is $\boxed{ 600} .
Explanation
Calculate the Total Cost First, we need to calculate the total cost of one year of college. We sum the costs of tuition, room and board, transportation, books and fees, and other costs:
Total Cost Calculation The total cost is:
12450 + 10125 + 2600 + 2250 + 1250 = 28675
Calculate Remaining Cost Next, we subtract the grant amount from the total cost to find the remaining cost that Giselle needs to cover:
28675 − 4000 = 24675
Calculate Total Months to Save Now, we calculate the total number of months Giselle has to save by multiplying the number of years by 12:
4 ye a rs × 12 m o n t h s / ye a r = 48 m o n t h s
Calculate Minimum Monthly Deposit Finally, we divide the remaining cost by the total number of months to find the minimum monthly deposit needed:
48 24675 = 514.0625
Determine the Answer from the Options Therefore, the minimum monthly amount she should deposit is approximately $514.06 . Since the question provides options in increments of $100 , the closest option greater than $514.06 is $600 . However, we need to select the minimum amount she should deposit to be able to pay her contribution. Since $514.06 is the exact amount, we should choose the closest option that is greater than or equal to this amount. Among the given options, $500 is less than $514.06 , so it's not enough. The next higher option is $600 .
Examples
Let's say you're planning a big trip in 3 years and need to save up for it. By estimating all the costs (flights, accommodation, activities) and subtracting any expected financial gifts, you can calculate the total amount you need to save. Then, dividing that total by the number of months you have to save will give you the minimum monthly deposit you need to make into a savings account. This ensures you reach your savings goal in time for your trip!
Giselle needs to save approximately $514.06 monthly to cover her college expenses after the grant. Since the options provided are in increments of $100, the closest and feasible option is $600. Hence, she should deposit $600 each month into her savings account.
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