Question

Andrew has $2300 to invest for the next 10 years. He has three options for investment.

Option A: The interest rate is 3% compounded monthly.
Option B: The interest rate is 5% compounded quarterly.
Option C: The interest rate is 7% compounded annually.

Which option yields the greatest return on Andrew's investment?​

Answer 1

Option C

Explanation:

.07 at 3500 for 10 years annually gives a 24.58 return. Option C will give Andrew the most in return.

Answer 2

Option C

Explanation:

.03 at 3500 for 10 years monthly will give a 10.52 return.

.05 at 3500 for 10 years quarterly will give a 17.54 Return.

.07 at 3500 for 10 years annually gives a 24.58 return. Option C is the best one for him to choose.