Respuesta :
Answer:
$263.07
Step-by-step explanation:
Simple interest is calculated by multiplying the principal amount, the interest rate, and the number of periods. The formula is:
A=P(1+rt)
where A is the final amount, P is the principal amount, r is the interest rate per period, and t is the number of periods.
Compound interest is calculated by multiplying the principal amount by the growth factor raised to the power of the number of periods. The formula is:
A=P(1+r)t
where A is the final amount, P is the principal amount, r is the interest rate per period, and t is the number of periods.
In this question, both accounts have an initial deposit of $5,000 at 2.5% interest for 11 years. The interest rate per period is 0.025 for simple interest and 0.025/12 for compound interest, since it is compounded monthly. The number of periods is 11 for simple interest and 11*12 for compound interest, since there are 12 months in a year.
Using the formulas, we can calculate the final amounts of both accounts:
Simple interest: A=5000(1+0.025∗11)=6875
Compound interest: A=5000(1+0.025/12)11∗12=7138.07
The difference between the two amounts is:
7138.07−6875=263.07
Therefore, the account with compound interest will have $263.07 more than the account with simple interest after 11 years.
