Question

Four banks have provided proposals for a savings account. Which scenario provides exponential growth that will best benefit the account holder?
A.The deposit increases by 3%, percent of its current value, compounded annually.

B.The deposit increases by 3%, percent of its current value, compounded monthly.

C. The deposit increases by 5%, percent of its initial value each year.

D. The deposit increases by 0.40% point, percent of its initial value each month.

Answer 1

Answer:

B. The deposit increases by 3% of its current value, compounded monthly.

Step-by-step explanation:

When compounded monthly that means the account is getting more money monthly rather than annually, or each year, so this answer choice would give the best benefit to the account holder. I did this problem on Khan Academy myself and this was the correct answer.