Question

Cooper will deposit $1,500 into an account that earns 7% simple interest every year. His sister Trinity will deposit $1,800 into an account that earns 6% simple interest every year. The deposits will be made on the same day, and no additional money will be deposited or withdrawn from the accounts. Which statement about the balances of Cooper's and Trinity's account at the end of 3 years is true?

Answer 1

For Cooper :

Simple interest = $315

The total amount he would have in his account = $1815

For Trinity :

Simple interest = $324

The total amount she would have in her account = $2124

Trinity's interest is higher than Cooper's interest by $9

The total amount of money Trinity would have at the end of 3 years is higher than that of Cooper by $309

Explanation:

Simple interest = principal x rate x time

Value = amount deposited + simple interest

For Cooper :

Simple interest = $1,500 x 0.07 x 3 = $315

The total amount he would have in his account = $1,500 + $315 = $1815

For Trinity :

Simple interest = $1800 x 0.06 x 3 = $324

The total amount she would have in her account = $1,800 + $324 = $2124