Answer:
$0.78
Step-by-step explanation:
Here we have to use the formulas.
Compound interest calculate semiannually
A = P(1 + r/2)^2n
Where P = Principal
R = Rate and n = number of years
Here n = 1, r = 6% = 0.06
A = 1000(1 + 0.06/2)^2(1)
= 1000(1 +0.03)^2
= 1000 (1.03)^2
= 1000(1.0609)
A = 1060.9
Compound interest = 1060.9 - 1000
= $60.90
Compound interest calculated monthly
A = P(1 + r/n)^nt
Here is n is the number of times the interested compounded per year, n = 12 and t = number of years
A= 1000(1 + 0.06/12)^12(1)
A= 1000(1 + 0.005)^12
A= 1000(1.005)^12
A= $1061.68
Compound interest calculated monthly (after 1 year) = 1061.68 - 1000
=$61.68
The difference in interest earned at the end of the year = $61.68 - $60.90
= $0.78
Thank you.
