Question

4. principal = $125

rate = 4%
time = 2 years
simple interest =
compound interest =

Answer 1

Below in bold.

Explanation:

Simple interest = PRT/100

= 125* 4 * 2 / 100

= $10.

New amount = $135.

Compound Interest<

Amount after 2 years = 124

= 125(1 + 0.04)^2

= 135.20

Interest = 135.2 - 125

= $10.20.

New amount = $135.20.