Answered

Welcome to Westonci.ca, where curiosity meets expertise. Ask any question and receive fast, accurate answers from our knowledgeable community. Experience the convenience of getting reliable answers to your questions from a vast network of knowledgeable experts. Join our platform to connect with experts ready to provide precise answers to your questions in different areas.

Tavius wants to invest $2,500. Which option will earn him the best value?

A. A two-year certificate of deposit with a nominal interest rate of 3 percent.

B. A savings account with 3 percent simple interest.

C. A three-year certificate of deposit with a nominal interest rate of 4 percent.

D. A savings account with 3 percent interest compounded annually.

Sagot :

Tavius would earn his best value if he invests in a  three-year certificate of deposit with a nominal interest rate of 4 percent.

Tavius would invest in the option that yields the highest interest. This is the best value. In order to determine which option is the best, the interest rate of each option has to be determined.

Interest rate of the first option

Interest earned = amount invested x time x interest rate

$2500 x 0.03 x 2 = $150

Interest rate of the second option

Interest earned = amount invested x time x interest rate

$2500 x 0.03 x 1 = $75

Interest rate of the third option

Interest earned = amount invested x time x interest rate

$2500 x 0.04 x 3 = $300

Interest rate of the fourth option

FV = P x (1 + r) n

$2500 x (1.03) = $75

A similar question was answered here: https://brainly.com/question/24748787?referrer=searchResults

basketballj12

Answer:

D

Step-by-step explanation:

a savings account with 3 interest compound annually

Visit us again for up-to-date and reliable answers. We're always ready to assist you with your informational needs. Your visit means a lot to us. Don't hesitate to return for more reliable answers to any questions you may have. Get the answers you need at Westonci.ca. Stay informed by returning for our latest expert advice.