SOLUTION: Hello,
I am having trouble with the following question:
Suppose you have $1,000 to invest. You can either invest in a CD that yields an 8% simple interest, or in a CD that yi
Algebra ->
Customizable Word Problem Solvers
-> Misc
-> SOLUTION: Hello,
I am having trouble with the following question:
Suppose you have $1,000 to invest. You can either invest in a CD that yields an 8% simple interest, or in a CD that yi
Log On
Question 1135557: Hello,
I am having trouble with the following question:
Suppose you have $1,000 to invest. You can either invest in a CD that yields an 8% simple interest, or in a CD that yields a 6% interest if compounded quarterly. Which investment will yield a greater return at the end of one year. Show work to prove your answer.
I believe it would be 6% compounded but I'm not sure how to prove it.
Thank you so much in advance! Answer by josmiceli(19441) (Show Source):
You can put this solution on YOUR website! For simple interest:
$1,080
--------------------------------
For compound interest: (compounded quarterly )
$1,061.36
The simple interest gives more return
