Question

HELP ME NOWWWWWWWWWWWWWWWWWWWWWW

Two savings accounts each start with a $100 principal and have an interest rate of 5%. One account earns simple interest and the other earns annual compound interest. Which account will earn more interest over 10 years? How much more? Round to the nearest cent when necessary.

Answer 1

Answer:105.00

A = $105.00

I = A - P = $5.00

Equation:

A = P(1 + rt)

First, converting R percent to r a decimal

r = R/100 = 0.5%/100 = 0.005 per year.

Solving our equation:

A = 100(1 + (0.005 × 10)) = 105

A = $105.00

The total amount accrued, principal plus interest, from simple interest on a principal of $100.00 at a rate of 0.5% per year for 10 years is $105.00.