Question

D Question 1

Answer 1

Answer:

$600 (if not compound interest) read below

Step-by-step explanation:

This question is asking for the amount of interest, not the total including the $6,000 CD, which means the question will be way simpler.

1. You try to find interest for 2 years.
2. This is mostly mental work. What is 5% of 6000?
3. Equation: (5% of 6000)(2)
4. (300)(2)
5. $600 in interest.
6. This depends. Are we trying to find compounded interest? If we were, we would find 5% of 6000, add it to 6000, then add 5% of that sum.
7. (0.05)(6000)+6000=x, x(0.05)=compounded interest
8. 300+6000=x, x=6300
9. 6300(0.05)+6300=compounded interest
10. 315+6300=compounded interest
11. 6615=total after compounded interest
12. 6615-6000=how much in interest is paid
13. $615 in compounded interest.