document.write( "Question 188472: \"Find the difference between the simple interest and the compound interest that would be earned from $1,000 invested for 2 years at 5 $\"1%2F2\"$ %.\"\r
\n" ); document.write( "\n" ); document.write( "I asked this question a few days ago, but I dont understand the answer that was given. So if anyone can explain it better that would be great.
\n" ); document.write( "Thank you (and sorry for having to ask it twice)\r
\n" ); document.write( "\n" ); document.write( "Answer given: 1,000(1+.055)^2
\n" ); document.write( "1,000(1.055)^2
\n" ); document.write( "1,000*1.113=$1,113.03 amount of the investment after 2 years. \n" ); document.write( "

Algebra.Com's Answer #141297 by stanbon(75887) $\"\"$ $\"About$

You can put this solution on YOUR website!
\"Find the difference between the simple interest and the compound interest that would be earned from $1,000 invested for 2 years at 5%.\"
\n" ); document.write( "-----------
\n" ); document.write( "Simple interest:
\n" ); document.write( "I = Prt = 1000*0.05*2 = $100
\n" ); document.write( "---------------------------------
\n" ); document.write( "Compound interest:
\n" ); document.write( "I = P[(1+0.05)^2 - 1)]
\n" ); document.write( "I = 1000[1.05^2-1]
\n" ); document.write( "I = $102.50
\n" ); document.write( "=======================
\n" ); document.write( "Cheers,
\n" ); document.write( "Stan H.\r
\n" ); document.write( "\n" ); document.write( " \n" ); document.write( "

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