SOLUTION: How much more interest is earned on an investment of $12,585 at 3.5% interest over 5 years if the interest is compounded annually rather than earning simple interest?

Question 1036619: How much more interest is earned on an investment of $12,585 at 3.5% interest over 5 years if the interest is compounded annually rather than earning simple interest?
Answer by jorel555(1290) (Show Source): You can put this solution on YOUR website!
$12585 * .035=$440.475 interest per year; for 5 years that equals $2202.375 total interest. Compounded annually, your total account is 12585 * 1.035^5=14947.032156. Subtracting the original amount, you get 2362.03 total interest. $2362.03-2202.375=$159.66 more interest earned when compounded annually, versus simple interest.
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