Find the balance after 10 years of a $30,000 savings account that pays 10% interest compounded yearly.(1 point)
Responses
$33,154.81
$33,154.81
$112,070.90
$112,070.90
$77,812.27
$77,812.27
$2,245,256.05
The correct answer is $77,812.27
Between simple interest at 8% and compound interest at 9%, find the higher resulting balance after investing $500 for a period of 10 years. Round the answer to two decimal places.(1 point)
The higher resulting balance after investing $500 for a period of 10 years is $
.
To find the higher resulting balance, we need to compare the balances from both types of interest.
For simple interest:
Simple interest formula: A = P(1 + rt)
A = balance
P = principal (initial investment)
r = interest rate (as a decimal)
t = time (in years)
A = 500(1 + 0.08(10))
A = 500(1 + 0.8)
A = 500(1.8)
A = $900
For compound interest:
Compound interest formula: A = P(1 + r/n)^(nt)
A = balance
P = principal (initial investment)
r = interest rate (as a decimal)
n = number of times interest is compounded per year
t = time (in years)
A = 500(1 + (0.09/1))^(1*10)
A = 500(1 + 0.09)^(10)
A = 500(1.09)^(10)
A = $1,226.18
Therefore, the higher resulting balance after investing $500 for a period of 10 years is $1,226.18.