You save $8,500.00. you place 40% in a savings account earning a 4.2% apr compounded annually and the rest in a stock plan. the stock plan decreases 3% in the first year and increases 7.5% in the second year. what is the total gain at the end of the second year for both accounts combined?

The total gain at the end of the second year for both accounts combined is $509.09.

Step-by-step explanation:

Amount saved = $8500

40% of 8500 is saved in saving account;

Remainder amount in stock plan;

Working for savings plan:

Here, p = 3400 ; n = 1 , t = 2 , r = 0.042

Putting values in formula:

A = $3691.60

We get a gain of dollars

Working for stock plan:  

The stock plan decreases 3% in the first year and increases 7.5% in the second year.

When increases;

 dollars

So, we get a gain of dollars  

Therefore, we have a total gain of dollars.