Aubree invested $27,000 in an account paying an interest rate of 0.0825% compounded monthly. Addison invested $27,000 in an account paying an interest rate of 0.08625 % compounded continuously. After 20 years, how much more money would Addison have in her account than Aubree, to the nearest dollar?

Answers

Answer 1

Answer:

A = $27,445.50

Step-by-step explanation:

Equation:

A = P(1 + rt)

Calculation:

First, converting R percent to r a decimal

r = R/100 = 0.0825%/100 = 0.000825 per year.

Solving our equation:

A = 27000(1 + (0.000825 × 20)) = 27445.5

A = $27,445.50

The total amount accrued, principal plus interest, from simple interest on a principal of $27,000.00 at a rate of 0.0825% per year for 20 years is $27,445.50.

Answer 2

Answer: $11741

Step-by-step explanation:Rate 1: 8

4

1

%=8+1/4=

\,\,8.25\%\rightarrow 0.0825

8.25%→0.0825

\text{Rate 2: }8\tfrac{5}{8}\%=8+5/8=

Rate 2: 8

8

5

%=8+5/8=

\,\,8.625\%\rightarrow 0.08625

8.625%→0.08625

\text{Calculate Final Amount for Aubree}

Calculate Final Amount for Aubree

\overline{\phantom{\text{Calculate Final Amount for Aubree}}}

Calculate Final Amount for Aubree

\text{Compounded Monthly:}

Compounded Monthly:

A=P\left(1+\frac{r}{n}\right)^{nt}

A=P(1+

n

r

)

nt

P=27000\hspace{35px}r=0.0825\hspace{35px}t=20\hspace{35px}n=12

P=27000r=0.0825t=20n=12

A=27000\left(1+\frac{0.0825}{12}\right)^{12(20)}

A=27000(1+

12

0.0825

)

12(20)

A=27000(1.006875)^{240}

A=27000(1.006875)

240

A=139796.9278

A=139796.9278

\text{Calculate Final Amount for Addison}

Calculate Final Amount for Addison

\overline{\phantom{\text{Calculate Final Amount for Addison}}}

Calculate Final Amount for Addison

\text{Compounded Continuously:}

Compounded Continuously:

A=Pe^{rt}

A=Pe

rt

P=27000\hspace{35px}r=0.08625\hspace{35px}t=20

P=27000r=0.08625t=20

A=27000e^{0.08625(20)}

A=27000e

0.08625(20)

A=27000e^{1.725}

A=27000e

1.725

A=151538.0678

A=151538.0678

\text{How much more money Addison has:}

How much more money Addison has:

151538.0678-139796.9278

151538.0678−139796.9278


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Answers

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Answers

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      1            1 in

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