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)
Thank you for the opportunity to help you with your question!
$540 Pays 4.2% Annually
what about a 6.6% interest
The formula for annual compound interest is A = P (1 + r/n) ^ nt:
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
A=540 * 1.042^4
A= 540 *
For A rate of 6.6%
A=540 * 1.066^4
A= 540 *
Get the difference
Round of to the nearest Cents
Please let me know if you need any clarification. I'm always happy to answer your questions.
Jun 3rd, 2015
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