A group of students is arguing about which are better terms for a loan with compound interest—longer time with lower interest, or shorter time with higher interest. They decide to write a program to calculate each total so that they can compare between both the conditions:

Question

principal = 10000
rate = 10.25
time = 5
Amount = principal * (pow((1 + rate / 100), time))
Total = Amount + principal
print("Compound interest is", Amount + principal)
rate = 5.25
time = 10
Amount = principal * (pow((1 + rate / 100), time))
print("Compound interest is", Amount + principal)
Which code should be placed into a function?

(1 point)
Responses

Amount = principal * (pow((1 + rate / 100), time))
Amount = principal * (pow((1 + rate / 100), time))

principal = 10000
principal = 10000

print("Compound interest is", Amount + principal)
print("Compound interest is", Amount + principal)

rate = 10.25

Answer 1

To appropriately structure the code into a function, we should encapsulate the logic for calculating the compound interest and the total amount payable given the principal, rate, and time. Here's how you can create a function for this scenario:

def calculate_compound_interest(principal, rate, time):
    Amount = principal * (pow((1 + rate / 100), time))
    Total = Amount + principal
    return Total

#Example usage
principal = 10000
# First case
rate1 = 10.25
time1 = 5
print("Compound interest is", calculate_compound_interest(principal, rate1, time1))

# Second case
rate2 = 5.25
time2 = 10
print("Compound interest is", calculate_compound_interest(principal, rate2, time2))

Answer:

The code that should be placed into a function is:

Amount = principal * (pow((1 + rate / 100), time))
Total = Amount + principal

This code snippet effectively isolates the calculation logic, making it reusable for different rates and times.