Question

Monica deposits $100 into a savings account that pays a simple interest rate of 4.1%. Paul deposits $200 into a savings account that pays a simple interest rate of 2.9%. Monica says that she will earn more interest in 1 year because her interest rate is higher. Is she correct? Justify your response​

Answer 1

Paul

Explanation:

Paul earn more than monica. Though he is getting less interest but because of his higher initial amount he is getting more return.

Computing the return of both

Monica return is 100*3.4%= $3.4 in a year

Answer 2

9514 1404 393

Answer:

Monica is not correct

Explanation:

Monica's interest is ...

I = Prt

I = $100(0.041)(1) = $4.10

__

Paul's interest is ...

I = $200(0.029)(1) = $5.80

__

Paul's account earns more interest because of his greater initial deposit. Monica's statement is incorrect.