First City Bank pays 6 percent simple interest on its savings account balances, where Second city Ba

Jun 21st, 2015
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First City Bank pays 6 percent simple interest on its savings account balances, where Second city Bank pays 6 percent interest compounded annually. If you made a deposit of $ 7,500 in each bank, how much more money would you earn from your Second City bank account at the end of 10 years?

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Question # 1First City Bank pays 6 percent simple interest on itssavings account balances, where Second city Bank pays6 percent interest compounded annually. If you made adeposit of $ 7,500 in each bank, how much more moneywould you earn from your Second City bank account atFuture Value of deposit in First city BankAt first, we will calculate the Interest amount for one periodInterest = PV * Interest rateInterest = $ 7,500* 0.06Interest = $ 450.00Now we will calculate Fv of Deposited in First City bank:FV = PV +( Interest per year * 10)FV = $ 7,500 + ($ 450 * 10)FV = $ 7,500 + $

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