Time remaining:
comparing compounded interest balences

label Mathematics
account_circle Unassigned
schedule 0 Hours
account_balance_wallet $5

Sandra has two credit cards, P and Q. Card P has a balance of $726.19 and an interest rate of 10.19%, compounded semiannually. Card Q has a balance of $855.20 and an interest rate of 8.63%, compounded monthly. Assuming that Sandra makes no purchases and no payments with either card, after four years, which card’s balance will have increased by more, and how much greater will that increase be?
Jan 28th, 2015

this is your answer

Card P: 726.19(1+ 0.1019/2)^8 
=1080.70-726.19= 354.51

Card Q: 855.20(1+0.0863/12)^48
=1206.28-855.20= 351.08

354.51-351.08= $3.43

Jan 28th, 2015

Studypool's Notebank makes it easy to buy and sell old notes, study guides, reviews, etc.
Click to visit
The Notebank
...
Jan 28th, 2015
...
Jan 28th, 2015
Jun 25th, 2017
check_circle
Mark as Final Answer
check_circle
Unmark as Final Answer
check_circle
Final Answer

Secure Information

Content will be erased after question is completed.

check_circle
Final Answer