An elite private college receives large donations from successful alumni. The account that holds these
onations currently has $955,000,000.

a. What would be the new account balance in one year of simple interest at a rate of 5.33%
= IP +
I= (955,000,000) (1) (0573)
H =
b. What would be the new account balance in one year at 5.33% if the interest was compounded daily?
P=
c. How much more interest is earned when it is compounded daily compared to the simple interest?
. Why does the interest compounded daily earn more interest than if it only earned the simple
terest?