Question

Each of Mrs. White's two children received $50 for their savings account. The original amounts in their savings accounts were $500 and $300, respectively. Without calculating, which savings account had a greater percent of increase? Explain.

Answer 1

The second child's savings account had a greater percent increase because the same $50 increase represents a larger percentage of the smaller original amount of $300 compared to the first child's original amount of $500.

Step-by-step explanation:

In evaluating which of Mrs. White's children's savings accounts had a greater percent increase, we can consider the ratios of the increases to the original amounts without calculating the exact percentages. The first child’s account went from $500 to $550, which is an increase of $50 on the original $500. The second child’s account went from $300 to $350, also a $50 increase but on a smaller original amount of $300.

The percent increase is calculated by dividing the increase by the original amount and then multiplying by 100. Since both children received the same amount of money, but the second child’s original amount was less, the division will yield a larger number for the second child. Therefore, the second child’s account, which had an original amount of $300, experienced a greater percentage of increase than the first child’s account with the original $500.

Understanding the concept of percent increase is crucial when comparing changes to different initial values, a key concept that can apply to many financial decisions, such as evaluating investments or understanding growth in savings accounts.