Question 1086375: Tyler has $60,000 to invest for 3 years. Estimate which investment option will earn more interest. calculate to verify your estimate.
A. 5.1% simple interest, calculated monthly
B. 4.9% compound interest, calculated annually
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! Tyler has $60,000 to invest for 3 years. Estimate which investment option will earn more interest. calculate to verify your estimate.
A. 5.1% simple interest, calculated monthly
I = P*r*t
I = 60,000*0.051*3 = $9180
I = P(1+(r/n)^(nt) - P = 60000(1+0.051/12)^(12*3)-60000
=60000[(1+0.051/12)^(12*3)-1]
= 60000*0.164947 = $9896.83
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Cheers,
Stan H.
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