Joseph is a friend of yours. He has plenty of money but little financial sense. He received a gift of $12,000 for his recent gra

Question

3 years ago

9

Joseph is a friend of yours. He has plenty of money but little financial sense. He received a gift of $12,000 for his recent gra

duation and is looking for a bank in which to deposit the funds. Partners' Savings Bank offers an account with an annual interest rate of 3% compounded semiannually, while Selwyn's offers an account with a 2.75% annual interest rate compounded continuously. Calculate the value of the two accounts at the end of one year, and recommend to Joseph which account he should choose.

Mathematics

1 answer:

Nata [24] · Answer 1 · 2022-12-10T09:30:15+03:00

Answer:

The value for partners savings bank at the end of 1 year is $12,362.70. The value for Selwyn's at the end of 1 year is $12,334.58. The future value obtained by investing in Partners Saving Bank is more as compared to Selwyn’s Saving Bank. Hence Joseph is recommended to choose Partners Saving Bank.

Step-by-step explanation: