Gary deposits $1,500 into each of two savings accounts. Account I earns 5% annual simple interest. Account II earns 5% interest

Question

3 years ago

8

Gary deposits $1,500 into each of two savings accounts. Account I earns 5% annual simple interest. Account II earns 5% interest

compounded annually. Gary does not make any additional deposits or withdrawals. What is the sum of the balances of Account I and Account II at the end of 4 years?

Mathematics

1 answer:

hodyreva [135] · Answer 1 · 2022-03-02T21:48:14+03:00

Answer:

$3623.26

Step-by-step explanation:

Given

Each deposit = $1500
Interest rate= 5%
Time = 4 years
Compound number = annual

Simple interest account

B = 1500*(1 + 4*0.05) = 1500*1.2 = $1800

Compound interest account

B = 1500*(1 + 0.05)^4 = $1823.26

Total balance

$1800 + $1823.26 = $3623.26