 # Math question help needed

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Ryyrel

### Question Description

You have \$540 in an account which pays 4.2% compounded annually. How many additional dollars of interest would you earn over 4 years if you moved the money to an account earning 6.6%?  (Round to the nearest Cent) Student has agreed that all tutoring, explanations, and answers provided by the tutor will be used to help in the learning process and in accordance with Studypool's honor code & terms of service. \$540 Pays 4.2% Annually

The formula for annual compound interest is A = P (1 + r/n) ^ nt:

Where:

A = the future value of the investment/loan, including interest
P = the principal investment amount (the initial deposit or loan amount)
r = the annual interest rate (decimal)
n = the number of times that interest is compounded per year
t = the number of years the money is invested or borrowed for

P=\$540

r=4.2%=0.042

n=1

t=4

A=540(1+0.042)^4

A=540 * 1.042^4

A= 540 *  1.178883

A=\$ 636.5971

For A rate of 6.6%

P=\$540

r=6.6%=0.066

n=1

t=4

A=540(1+0.066)^4

A=540 * 1.066^4

A= 540 *  1.291305

A=\$ 697.3047

Get the difference

= \$697.3047- \$636.5971

=\$ 60.7076

Round of to the nearest Cents

=\$60.7 avpubynfXvz (1253)
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