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You just won the lottery! You now have $25,000! You make a smart decision and invest all $25,000 to earn interest on it over the next 10 years.


You need to find 3 local banks and find their savings interest rates.


Then you need to decide which bank will earn you the most money after investing $25,000 for 10 years. Use the SIMPLE INTEREST FORMULA.


1) Which bank yielded the highest amount of interest earned? Which bank yielded the lowest amount of interest earned?

2) What is the difference in the principal invested for banks that yielded the highest and lowest interests from Question 1? What is the difference in the interest earned for the banks from Question 1?

3) Which bank would you invest your $25,000? WHY?

Respuesta :

The difference between the interest compounded daily and the interest compounded annually is $67.13.

To calculate the interest earned by your money annually, you calculate as follows;

To determine the interest, use FV - amount invested

FV = P (1 + r)^n

the above represents,

FV = Future value

P = Present value

R = interest rate

N = number of years

$25,000 (1.0725) = 26,812.50

26,812.50 - $25,000 = $1,812.50

What is the interest earned in your money is compounded on a daily basis?

$25,000x (1 + 0.0725 /365)^365 = 26,879.63

26,879.63 - $25,000 = $1879.63

What is the difference in interest?

$1879.63 -  $1,812.50 = $67.13

please visit the link below for more details

https://brainly.com/question/26719341

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