Posted by **Greg** on Wednesday, November 14, 2012 at 7:56pm.

I was wondering if I could check my answers with someone. I'm a bit confused with interest. I put stars next to the answers I chose. Thank you.

An interest rate is a special type of (1 point)

loan.

**price.

bank.

service.

2.

How does a compound interest rate differ from a simple interest rate? (1 point)

***Compound interest rates pay more interest over time.

Compound interest rates are calculated only once a year.

Compound interest rates are usually lower than simple interest rates.

Compound interest rates apply to home mortgages only.

3.

Rising demand for a certain type of car will probably lead to (1 point)

lower interest rates for all types of vehicles.

lower interest rates for that type of car.

***higher interest rates for all types of vehicles.

higher interest rates for that type of car.

4.

Rohan has $100.00 that he wants to save in a bank. Bank A offers two types of savings accounts. One has a 5% simple interest rate, and the other has a 4.8% compound interest rate. Bank B also offers two types of savings accounts. One has a 3% simple interest rate, and the other has a 4% compound interest rate. Which account should Rohan choose in order to earn the most interest? (1 point)

Bank A simple interest account

***Bank A compound interest account

Bank B simple interest account

Bank B compound interest account

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