Answer:
Bill by $85
Step-by-step explanation:
Bill : Compound interest is calculated by multiplying the initial principal amount by one plus the annual interest rate raised to the number of compound periods minus one. The total initial amount of the money given is then subtracted from the resulting value.
Compounded annually for 6 years at 9 % interest Bill would have $8385.50.
Joe : Simple interest at 11% a year The formula we'll use for this is the simple interest formula.
P is the principal amount, $5000.00.
r is the interest rate, 11% per year, or in decimal form, 11/100=0.11.
t is the time involved, 6year(s) time periods.
So, t is 6year time periods.
To find the simple interest, we multiply 5000 × 11 × 6 = 3300
Usually now, the interest is added onto the principal to figure some new amount after 6 year(s),
or 5000.00 + 3300.00 = 8300.00
As you can see Bill has more by $85.
^Check yourself
