Question

You have the option to deposit $6500 into an account that pays 3.25% interest, compounded quarterly OR to deposit your money into an account that pays the same interest rate but compounds continuously. Which option yields you more money after 5 years and how much more?

Answer 1

Explanation:

Plug in the giving information, P = 4000, r = 0.06, n = 4,

and t = 5.

Use the order or operations to simplify the problem. If the

problem has decimals, keep as many decimals as possible

until the final step.

FV = 5387.42 Round your final answer to two decimals places.