Question

Challenge You have 2 different savings accounts. For Account A, the simple interest earned after 9 months is $5.40. For

Account B, the simple interest earned after 18 months is $15.75. If the interest rate is 3.6% for Account A and 2.1% for
Account B, how much is the principal in each account? Which account earned you the most interest the first month?
Explain your answer.
Account A has a principal of $
CTTB
(Round to the nearest dollar as needed.)

Answer 1

To calculate the principal in each account, we can use the following formula:

Principal = Simple Interest / (Interest Rate * Time)

For Account A:

Principal = $5.40 / (3.6% * 9 months)

Principal = $16.67 (rounded to the nearest dollar)

For Account B:

Principal = $15.75 / (2.1% * 18 months)

Principal = $41.67 (rounded to the nearest dollar)

To calculate which account earned the most interest the first month, we can use the following formula:

Simple Interest = Principal * Interest Rate * Time

For Account A:

Simple Interest = $16.67 * 3.6% * 1 month

Simple Interest = $0.60

For Account B:

Simple Interest = $41.67 * 2.1% * 1 month

Simple Interest = $0.88

Therefore, Account B earned more interest the first month.

Answer:

Account A has a principal of $16.67.

Account B has a principal of $41.67.

Account B earned more interest the first month.

Step-by-step explanation:

Account B has a higher principal and a higher interest rate, so it earned more interest the first month.