Question 1114966
the one that offers compound interest should get her more money.


let's assume she puts 10,000 in each account, and she is saving for 10 years.


the account that gives her simple interest will give her .045 * 10,000 * 10 = 4500 in interest, which gives her a total of 14,500 at the end of 10 years.


the account that gives her annual compound interest will give her 10,000 * 1.045 ^ 10 = 15,529.69422 at the end of the 10 years.


the difference is that she is earning interest on her interest in the annual compound account, while she is only earning interest on her principal in the simple interest account.