Question

James invests $10,000 in an account earning 6% interest, compounded annually. Curtis invests $10,000 in an account earning 5% interest, compounded annually. Given that no additional deposits are made, compare the balances of the two accounts after 10 years. (round to the nearest dollar)

Answer 1

James has $1,619 more in his account than Curtis

Explanation:

Just took it on USATestPrep

Answer 2

we are given that

James invests $10,000 in an account earning 6% interest, compounded annually.

Curtis invests $10,000 in an account earning 5% interest, compounded annually.

Given that no additional deposits are made, compare the balances of the two accounts after 10 years.

So here t=10 years.

As we know that

`A=P(1+ (r)/(100) )^n`

So In James account after 10 years we have

`A=10000(1+ (6)/(100) )^(10)`

`A=10000(1+0.06 )^(10)`

`A=10000(1.06 )^(10)=17908.5 \approx 17909` $

So In Curtis account after 10 years we have

`A=10000(1+ (5)/(100) )^(10)`

`A=10000(1+0.05 )^(10)`

`A=10000(1.05 )^(10)=16288.9 \approx 16289` $

Hence james will have 17909-16289=1620$ more in his account after 10 years.