Person A deposits S260 in an account that pays 5% interest compounded once a yea

Question

Person A deposits S260 in an account that pays 5% interest compounded once a year Person B dep hs S2250 in an accounthat pays 6% interest co po ded a. Who will have more money in their account after one year? How much more? Select the correct choice below and Si in the answer bex within your choice ortey Complete parts (a) ough(c below (Round to the nearest dollar as needed) O A. Person A will have $1-1 more than Person B O B. Person B will have S more than Person A b. Who will have more money in theik account ater five years? How much more? Select the correct choice below and ll n the answer box wilthin your choice (Round to the nearest dollar as needed ) d A. Person B wil have Smore than Person A OB. Person A will have Srl more than Person B C. Who will have more Round to the nearest dollar as needed ) money in their account after 20 years? How much more? Select the corect choice below and l in the anower box within your choice A. Person B wil have S-more than Person A B. Person A will have SCI more than Person B

Explanation / Answer

Answer to the question is as follows:

a. 2600 at 5% compounded once a year.

A: 2600(1+.05)^1 = $2730

B: 2250(1+.06/12)^12 = $2388.8

Person A will have $341.2 more than Person B

b. After 5 years:

A: 2600(1+.05)^5 = $3318.3

B: 2250(1+.06/12)^60 = $3034.9

Person A will have $283.43 more than Person A

c.

A: 2600(1+.05)^20 = $6898.6

B: 2250(1+.06/12)^720 = $81610.7

Person B will have $74712.1 more than Person A

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