Question

Suppose you have two bank accounts. In Account A you deposit ​$100. In Account B you deposit ​$300. Account A has a simple interest rate of ​4.3%. Account B has a simple interest rate of 2.1​%. One year​ later, you get a bank statement from each bank and one of the statements shows an incorrect amount of interest. The interest for Account A is ​$4.30. The interest for Account B is ​$630. Which account statement is​ incorrect? Find the​ bank's likely error.

Answer 1

ANSWER-

The interest for Account B is likely incorrect.

The interest for Account A can be calculated as follows:
$100 * 4.3% = $4.30

The interest for Account B should be calculated as follows:
$300 * 2.1% = $6.30

Since the interest for Account B is much higher than it should be, the statement from that account is likely incorrect. The bank's likely error is overstating the interest earned on Account B.