Year First Second Third Interest Melissa earns (Interest compounded annually) $ $ $ Interest Greg earns (Simple interest)
Year First Second Third Interest Melissa earns (Interest compounded annually) $ $ $ Interest Greg earns (Simple interest)
Chapter9: Sequences, Probability And Counting Theory
Section: Chapter Questions
Problem 15PT: Rachael deposits $3,600 into a retirement fund each year. The fund earns 7.5% annual interest,...
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Question
Melissa deposits $70,000 into an account that pays 4% interest per year, compounded annually.
Greg deposits $70,000 into an account that also pays 4% per year. But it is simple interest.
Greg deposits $70,000 into an account that also pays 4% per year. But it is simple interest.
Find the interest Melissa and Greg earn during each of the first three years.
Then decide who earns more interest for each year.
Assume there are no withdrawals and no additional deposits.
Year
First
Second
Third
Interest Melissa earns
(Interest compounded annually) $
$
$
Interest Greg earns
(Simple interest) $
$
$
Who earns more interest?
|
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