Question 1135874
Hi,
I would very much appreciate help with this problem:

Decide whether the statement makes sense, and explain your reasoning. John is planning to invest his money for one year only. He chose an account paying simple interest at 6% per year which was clearly a better deal than an account paying a 5.9% APR with interest compounded annually.

Thank you!
<pre>Simple interest FV amount, or {{{matrix(1,15, A[SI], "=", P(1 + TR), "=====>", A[SI], "=", P(1 + 1 * .06), "=====>", A[SI], "=", P(1 + .06), "=====>", A[SI], "=", 1.06P)}}}
Compound interest FV amount, or {{{matrix(1,15, A[CI], "=", P(1 + r/1)^(1 * 1), "=====>", A[CI], "=", P(1 + .059/1)^1, "=====>", A[CI], "=", P(1 + .059), "=====>", A[CI], "=", 1.059P)}}}
Which is better? You decide, and explain why you made that choice!