Question

Christine has $500 to deposit in a savings account, and she is trying to decide between two banks. Bank A offers 10% annual interest compounded quarterly.

Rather than compounding interest for smaller accounts, Bank B offers to add $15 quarterly to any account with a balance of less than $1,000 for every quarter, as long as t
here are no withdrawals. Christine has decided that she will neither withdraw, nor make a deposit for a number of years. Develop a model that will help Christine decide which bank to use.

Answer 1

Christine should make a annual model adequated to her needs.

Explanation:

-First, she should save those $500 until she gets to the $1000.

-Then depending on the number she gets use these formulations:

For bank A: (x)*.10

For bank B: (x*.15)15

x= the total number of savings that Christine has at the end.