4
QuizMultiple Choice

Comparing Types of Interest — Quiz

Question 4 • Advanced Financial Algebra

Daniel is deciding between a compound interest account with a 3% annual rate, compounded quarterly, and a continuously compounded interest account at 2.75% annually for his $⁢10,000 savings for 5 years. Which account will have a higher balance after 5 years? Compound Interest Formula: A=P⁢(1+(r)/(n))^n⁢t Continuously Compounded Interest Formula: A=P⁢e^r⁢t The value of e , also known as Euler's number, is approximately 2.71828

Answer
A
Both accounts will have the same balance
B
More information is needed to decide
C
Continuously Compounded Interest Account
D
Compound Interest Account
Previous
Next