Question

Lester deposited 400 into a savings account earning 4.5% simple interest, and $450 into an investment account earning 3.2% interest compounded annually. what was the total interest he earned in 3 years

Answer 1

Simple interest earned
I=prt
I=400×0.045×3=54
Compound balance after 3 years
A=p(1+r)^t
A=450×(1+0.032)^(3)=494.597
Compound interest earned=494.597−450=44.597
Total interest earned=54+44.597==98.597