Melanie invested $8,600 in an account paying an interest rate of 2 7/8% compounded monthly.
Oliver invested $8,600 in an account paying an interest rate of 2 3/4% compounded daily.
After 10 years, how much more money would Melanie have in her account than Oliver, to the nearest dollar?
For Melanie, P = 8600, r = 2 7/8% = 2.875% = 0.02875, n = 12, t = 10
A = 8600 * (1 + 0.02875/12)^(12)(10) = 8660 * (1.002395833333)^120 = 8600 * 1.332632285 = 11460.64
For Oliver , P = 8600, r = 2 3/4% = 2.75% = 0.0275, n= 365, t = 10
A = 8600 * (1 + 0.0275/365)^(365)(10) = 8600 * 1.000075342^3650 = 8600 * 1.316514799 = 11322.03
Answer:
Melanie: $11,461
Oliver: $11,322