Iane deposits 30000 into an account that pays simple...

Name: iane deposits 30000 into an account that pays simple interest at a rate of per year 4 henry deposits 30000 into an account that also pays 4 interest per year but it is compounded annually fi 55333
Uploaded: 2023-09-10T08:27:28-08:00
Duration: 4 min 18 s
Channel: Supreeta N
Description: iane deposits 30000 into an account that pays simple interest at a rate of per year 4 henry deposits 30000 into an account that also pays 4 interest per year but it is compounded annually fi 55333

iane deposits 30,000 into an account that pays simple interest at a rate of per year 4%. Henry deposits 30,000 into an account that also pays 4% interest per year. But it is compounded annually. Find the interest Diane and Henry earn during each of the first three years. Then decide who earns more interest for each year.

Transcript

00:01 Hi, now we are going to find the interest earned by diana and henry for first 3 years.

00:08 So now here the given deposit of diana is $60 ,000 into the account that pays 3 % interest per year so this will be 0 .03.

00:22 Here the interest was compounded annually.

00:25 So we know that the formula for calculating the compound interest is a is equal to p into 1 plus or the whole power t and the compound interest will be equal to a minus p.

00:39 So now for the first year the amount in the account will be equal to 60 ,000 into 1 plus 0 .03 the whole power 1 and this will be equal to $61 ,800.

00:58 Then the compound interest for the first year will be equal to 61 ,800 minus 60 ,000 and this will be equal to $1 ,800.

01:14 And next we are going to find the compound interest for second year.

01:19 The amount in the account after 2 years will be 60 ,000 into 1 plus 0 .03 the whole square and this will be equal to $63 ,654.

01:34 Then the compound interest for second year will be equal to 63 ,654 minus 61 ,800 and this will be equal to $1 ,854.

01:50 And next we are going to calculate the compound interest for the third year.

01:57 Now the amount in the account after 3 years will be 60 ,000 into 1 plus 0 .03 the whole power 3 and this will be equal to 65 ,563 .62.

02:12 Then the compound interest for third year will be equal to 65 ,563 .62 minus 63 ,654 and this will be equal to $1 ,909 .62...

Question

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