Homework Help: Economics - Finance

Posted by Wendi Jones on Monday, October 1, 2012 at 2:22pm.

If your bank pays 5.5 percent interest on savings deposits, what is the simple interest paid in the third year on an initial $100 deposit?
What is the total amount in the account after three years?
What is the amount after three years if the interest was compounded annually?

Economics - Finance - Steve, Monday, October 1, 2012 at 2:59pm
the same as every other year: .055*100 = 5.50

100(1+.055*3) = 116.50

100(1.055)^3 = 117.42

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