Ask Question
BusinessBusiness
23 October, 16:24

The same amount of principal is invested in different accounts earning the same interest rate. Which of the following accounts would have the greatest accumulated value at the end of one year?

a. An account earning no interest

b. An account earning simple interest

c. An account earning interest compounded annually

d. An account earning interest compounded daily

+2
Answers (1)
  1. 23 October, 19:54
    0
    D.) An account earning interest compounded daily.

    This is the account that would have the greatest accumulated value at the end of one year.

    Let us assume the following figures.

    Principal = 1,000

    Interest rate = 12% p. a.

    Term 1 year

    a) account earning no interest = 1,000

    b) account earning simple interest

    S. I. = 1,000 x 12% x 1 = 120

    Balance = 1000 + 120 = 1,120

    c) account earning interest compounded annually

    FV = 1,000 (1+.12) ¹

    FV = 1,000 (1.12)

    FV = 1,120

    d) account compounded daily

    FV = 1,000 (1 +.12/365) ³⁶⁵

    FV = 1,000 (1 + 0.00033) ³⁶⁵

    FV = 1,000 (1.00033) ³⁶⁵

    FV = 1,000 (1.128)

    FV = 1,128
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “The same amount of principal is invested in different accounts earning the same interest rate. Which of the following accounts would have ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Kathryn Edin and Maria Kefalas researched low-income women and nonmarital childbirth. What did they conclude about why these women had children despite not being able to afford to do so?
Answers (1)
The following list includes selected permanent accounts and all of the temporary accounts from the December 31, 2018, unadjusted trial balance of Emiko Co ... Emiko Co. uses a perpetual inventory system.
Answers (2)
A decrease in the price level a. increases the quantity of goods and services supplied in the short run. b. decreases the quantity of goods and services demanded. c. increases the quantity of goods and services demanded. d.
Answers (1)
I believe that people can control 100% of what happen to them at work strongly agree or strongly disagree
Answers (1)
Seven years ago, Carlos took out a 30-year mortgage for $185,000 at 5.6 percent. He has made all of the monthly payments as agreed. What is his current loan balance
Answers (1)
New Questions in Business
Suppose you currently earn $30,000 a year. you are considering a job that will increase your lifetime earnings by $300,000 but that requires an mba. the job will mean also attending business school for two years at an annual cost of $25,000.
Answers (1)
Wickland Company installs a manufacturing machine in its production facility at the beginning of the year at a cost of $154,000. The machine's useful life is estimated to be 5 years, or 370,000 units of product, with a $6,000 salvage value.
Answers (1)
The manger is responsible for training you about food safety in your job duties. These duties include preventing foodborne illness by?
Answers (1)
The use and importance of managerial accounting is growing in each of the following areas except for a. nanotechnology advancements. b. enterprise risk management. c. corporate sustainability reporting. d. quality accounting. e. lean accounting.
Answers (1)
What are the best characteristic of a good circular flow of income?
Answers (1)
Home » Business » The same amount of principal is invested in different accounts earning the same interest rate. Which of the following accounts would have the greatest accumulated value at the end of one year? a. An account earning no interest b.
Sign Up Forgot Password?