Answer:
1. A part of your emergency fund should include - cash (a person should have 3 months worth of cash as emergency funds saved.)
2. An emergency can be - a natural disaster (natural disasters like hurricanes or cyclones can occur at any point of time thus hampering your work schedule.)
3. Your emergency fund is 4 times your expenses
So, emergency fund = 4*(1500.45) = $6001.80
Half that amount is in savings = 6001.80/2 = $3000.90.
The interest earned at 3.15% for 45 days on 3000.90 is
3000.90*.0315*(45/365) = $11.65
The interest earned at 4.65% for 45 days on 3000.90 is
3000.90*.0465*(45/365) = $17.20
So, total interest in 45 days is $11.65 +17.20 = $28.85
4. The interest earned at 3.15% for 45 days on 1500.45 is
1500.45*.0315*(45/365) = $5.83
he interest earned at 4.65% for 45 days on 4501.35 is
4501.35*.0465*(45/365) = $25.81
The total interest earned = $5.83 +25.81 = $31.64
Hence, $31.64 -28.85 = $2.79 is earned more than in question 3.
