Question

Monica deposits ​$400 into a savings account that pays a simple interest rate of 4.4​%. Paul deposits ​$500 into a savings account that pays a simple interest rate of 3.6​%. Monica says that she will earn more interest in 1 year because her interest rate is higher. Is she​ correct? Justify your response.

Answer 1

From the above calculation it is clear that The interest earn by Monica is less than the The interest earn by Paul , so Monica is wrong

Explanation:

Given as :

The principal amount deposited by Monica in account = $ 400

The rate of interest = 4.4 % at simple interest

The time period = 1 years

Let The interest earn by Monica = $ x

From simple interest

Simple Interest =
`(\textrm principal* \textrm rate* \textrm time)/(100)`

Or, $ x =
`(\textrm $ 400* \textrm 4.4* \textrm 1)/(100)`

Or, x = $ 17.6

So, The interest earn by Monica = x = $ 17.6

Again

The principal amount deposited by Paul in account = $ 500

The rate of interest = 3.6 % at simple interest

The time period = 1 years

Let The interest earn by Paul = $ y

From simple interest

Simple Interest =
`(\textrm principal* \textrm rate* \textrm time)/(100)`

Or, $ y =
`(\textrm $ 500* \textrm 3.6* \textrm 1)/(100)`

Or, y = $ 18

So, The interest earn by Paul = y = $ 18

∴ As The interest earn by Paul
`>` The interest earn by Monica

Hence from the above calculation it is clear that The interest earn by Monica is less than the The interest earn by Paul , so Monica is wrong Answer