David and Hana Plan to Purchase a House in 5

Multiple Choice

David and Hana plan to purchase a house in 5 years' time. David already has $20,000 that he invested in an account two years ago that is earning 0.308% interest compounded monthly. Hanna plans to contribute $675 per month for the next 5 years into her account. Determine what the nominal rate of interest (based on monthly compounding) that Hanna's investment should earn if their combined savings is to total $70,000.

A) 3.07%
B) 4.22%
C) 3.68%
D) 4.04%
E) 4.59%