Question

A savings account at Bank A pays 5% simple interest. An account at Bank B pays 2% compound interest. The table shows the balance in each account after an initial deposit of $1000.Which describes the balances after a long period of time?
Year BankA BankB
1 $1000 $1000
2 $1050 $1020
3 $1100 $1040.40
4 $1150 $1061.21
5 $1200 $1082.43
A.The balance in BankA will be greater.
B.The balance in BankB will be greater.
C.The Balances will be the same.

Answer 1

After a long period of time The balance in BankB will be greater.

Because simple interest is just interest on the principle only which is 50 every year doesn't change but with compound interest you will get 2% Interest every year (interest on principle+interest of the previous year)

So it's b

Hope it helps

Answer 2

the balance in bank b will be greater