ECONOMICS
COMPOUND INTEREST
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
Emma and Paul each invest $2, 000 into accounts that earn 6% interest. If Emma’s account earns simple interest and Paul’s account earns compound interest, which is the value of each person’s account after 8 years?
|
|
Emma-$2, 960; Paul-$3, 187.70
|
|
|
Emma-$960; Paul-$3, 187.70
|
|
|
Emma-$2, 960; Paul-$1, 187.70
|
|
|
Emma-$960; Paul-$1, 187.70
|
Explanation:
Detailed explanation-1: -Find the compound interest on Rs. 10, 000 at 20% per annum for 6 months. compounded quarterly. = 1025.
Detailed explanation-2: -∴ C.I. = ₹(10824.32-10000) = ₹824.32.
Detailed explanation-3: -∴ Amount will be Rs. 3025 and Interest will be Rs. 525 If Compounded Annually.
There is 1 question to complete.