Answer:
To determine whether Monica is correct, we need to compare the amount of interest earned by Monica and Paul over a period of one year.
Monica deposited $100 into an account with a simple interest rate of 4.2%. To calculate the interest earned, we can use the formula:
Interest = Principal * Rate * Time
For Monica:
Principal = $100
Rate = 4.2% = 0.042 (as a decimal)
Time = 1 year
Interest earned by Monica = $100 * 0.042 * 1 = $4.20
Paul, on the other hand, deposited $200 into an account with a simple interest rate of 2.2%. Using the same formula:
For Paul:
Principal = $200
Rate = 2.2% = 0.022 (as a decimal)
Time = 1 year
Interest earned by Paul = $200 * 0.022 * 1 = $4.40
Based on the calculations, Paul will actually earn more interest in one year than Monica. Paul will earn $4.40, while Monica will only earn $4.20. Therefore, Monica is incorrect in stating that she will earn more interest because her interest rate is higher.