ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Meredith invests her tax return check into an account with a compounded interest rate of 1.75%. She plans on keeping the account open for 12 years. If she has $1600.87 in her account at the end of 12 years, approximately how much was her principal?
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$1, 300
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$1, 970
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$7, 690
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$11, 000
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Explanation:
Detailed explanation-1: -National average savings account interest rate The national average yield for savings accounts is 0.23 percent APY, according to Bankrate’s March 1 weekly survey of institutions. Many online banks have savings rates higher than the national average. The higher the rate, the more interest you’ll earn on your savings.
Detailed explanation-2: -Despite other offerings available, a savings account is still worth it. They are basic but highly helpful, allowing you to save money for almost anything while having protection from the FDIC and earning a little interest over time.
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