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belka [17]
3 years ago
11

Please see attached below and please explain how to solve.

Mathematics
1 answer:
densk [106]3 years ago
5 0

Answer:

  The 6% simple interest account earns more interest in 2 years.

Step-by-step explanation:

You can compare the multipliers in the interest formulas.

For simple interest, the amount in the account (A) starting with principal P and earning at rate r for t years will be ...

  A = P(1 +rt)

For the values given, r=.06 and t=2, the multiplier is ...

  1 +rt = 1 +.06·2 = 1.12

__

For interest compounded annually, the amount will be ...

  A = P(1 +r)^t

For the given values, the multiplier is ...

  (1+r)^t = (1.04)^2 = 1.0816

__

Since 1.12 > 1.0816, the account earning simple interest will earn more interest.

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