Cliff has some money he wants to invest for his retirement. He is offered two options: 10%/a simple interest or 5%/a compounded annually. Under what conditions should he choose the first option

Answer 1

1.05^n = 1+.1n
easiest to make a table
n 1.05^n 1+.1n
1 1.05 1.10
5 1.27 1.50
10 1.63 2
20 2.65 3
30 4.32 4 here the compounding has gotten ahead so look closer between 20 years and 30 years.