Question

PLEASE HELP! :( this table below shows the future value of a certificate of deposit (CD), after x years.Andre states the applied interest is simple interest.True or False? and why if you can?

Answer 1

Answer: TRUE

Step-by-step explanation: (Apex) just did the quiz 9/26/19

Answer 2

Andre states that the applied interest is simple interest, this statement is true.

Step-by-step explanation:

From the given table it is noticed that the value of y increased by 17.50 as the value of x increased by 1.

The rate of change is calculated as

`m=(y_2-y_1)/(x_2-x_1)`

For first two years the rate of change is

`m=(535.00-517.50)/(2-1)=17.50`

The rate of change for next two years is

`m=(552.50-535.00)/(2-1)=17.50`

Similarly, the rate of change for all years in 17.50.

Since the rate of change is same for all years, therefore the future value is increased by a constant rate, therefore the applied interest is simple interest.

So, the statement "the applied interest is simple interest" is true.