Linda deposits $1,800 into an account that pays 7.5% interest, compounded annually. Anna deposits $4,000 into an account that pays 5% interest, compounded annually. If no additional deposits are made to either account, what is the balance of each at the end of 10 years? (to the nearest dollar)

A) Linda's account: $3,710

Anna's account: $6,516

B) Linda's account: $2,315

Anna's account: $5,860

C) Linda's account: $2,647

Anna's account: $6,102

D) Linda's account: $3,150

Anna's account: $4,200

Question

Mathematics

Jazmyn Prince

3 September, 02:43

Linda deposits $1,800 into an account that pays 7.5% interest, compounded annually. Anna deposits $4,000 into an account that pays 5% interest, compounded annually. If no additional deposits are made to either account, what is the balance of each at the end of 10 years? (to the nearest dollar)

A) Linda's account: $3,710

Anna's account: $6,516

B) Linda's account: $2,315

Anna's account: $5,860

C) Linda's account: $2,647

Anna's account: $6,102

D) Linda's account: $3,150

Anna's account: $4,200

+1

Answers (1)

Know the Answer?

Rylee Martin · Answer 1

A is your answer because Since the interest is compounded annually, the balances grow exponentially.

, A = P (1 + r/n) nt

Linda = 1800 (1 + 0.075) 10 = ≈ $3,710

Anna = 4000 (1 + 0.05) 10 = ≈ $6,516