Get the answers you need at Westonci.ca, where our expert community is always ready to help with accurate information. Join our Q&A platform and get accurate answers to all your questions from professionals across multiple disciplines. Connect with a community of professionals ready to provide precise solutions to your questions quickly and accurately.
Sagot :
Answer:
- $0 difference
Step-by-step explanation:
David
- Principal P = $350
- Interest rate r = 3% = 0.03 PA compounded
- Compound number = continuous
- Time t = 5 years
Total in account after 5 years:
- [tex]A=Pe^{rt}=350*e^{0.03*5} = 406.64[/tex]
Jack
- Principal P = $350
- Interest rate r = 3% = 0.03 PA compounded
- Compound number n = 4
- Time t = 5 years
Total in account after 5 years:
- [tex]A = P(1+r/n)^{nt}=350(1+0.03/4)^{4*5}=406.41[/tex]
The difference in totals:
- $406.64 - $406.41 = $0.23 ≈ $0 rounded to the nearest dollar
After 5 years Jack will have $0.66 more money in his account than David.
What is a compound interest?
This is a type of interest that is compounded after time period it is said to be compounded. After that particular period, the interest is calculated and then added with the principle. For the next duration, the interest is calculated on the sum.
Here, to find the amount of money after n years, we need to use the formula S = P(1 + r)ⁿ.
For David, S = sum of money after the total period of investment.
P = Principle = $350, r = rate of interest = 3% compounded annually, n = time period = 5 years.
Now, S = $350(1 + 3/100)⁵ = $350(1 + 0.03)⁵ = $350(1.03)⁵ = $405.75
Hence, after 5 years, David will have $405.75 in his bank account.
For Jack, S = sum of money after the total period of investment.
P = Principle = $350, r = rate of interest = 3% compounded quarterly, n = time period = 5 years.
Now, S = $350(1 + 3/ 4× 100)⁵ˣ⁴ = $350(1 + 0.0075)²⁰ = $350(1.0075)²⁰ = $406.41.
Hence, after 5 years, Jack will have $406.41 in his bank account.
Therefore, Jack will have $(406.41 - 405.75) = $0.66 more money than David.
Learn more about compound interest here: brainly.com/question/25857212
#Tag #SPJ2
We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. Thanks for using our service. We're always here to provide accurate and up-to-date answers to all your queries. Thank you for visiting Westonci.ca, your go-to source for reliable answers. Come back soon for more expert insights.
