Find the best balance after investing $12,000 for a period of 7 years at two different interest earning types: simple interest at 5% and compound interest at 4.5%. Round the answer to two decimal places.(1 point) The best balance after investing $12,000 for a period of 7 years is $

Answer 1

The formula for simple interest is Principal x Rate x Time.
For simple interest, the balance after 7 years can be calculated as:
Balance = 12,000 x (1 + 0.05 x 7)
= 12,000 x (1 + 0.35)
= 12,000 x 1.35
= $16,200.

The formula for compound interest is P(1 + r/n)^(nt), where P is the principal, r is the annual interest rate, n is the number of times interest is compounded per year, and t is the number of years.
For compound interest, the balance after 7 years can be calculated as:
Balance = 12,000 x (1 + 0.045/1)^(1 x 7)
= 12,000 x (1 + 0.045)^7
= 12,000 x (1.045)^7
= $16,583.63.

Comparing the two balances, the best balance after investing $12,000 for a period of 7 years is $16,583.63.

Answer 2

Find the best balance after investing $12,000 for a period of 7 years at two different interest earning types: simple interest at 5% and compound interest at 4.5%. Round the answer to two decimal places.(1 point) The best balance after investing $12,000 for a period of 7 years is $

Answer 3

To calculate the best balance after investing $12,000 for 7 years at different interest rates and earning types, we need to compare the total accrued amount from both simple and compound interest.

For simple interest:
Balance = Principal x (1 + Rate x Time)
= $12,000 x (1 + 0.05 x 7)
= $12,000 x 1.35
= $16,200

For compound interest:
Balance = Principal x (1 + Rate/100)^Time
= $12,000 x (1 + 0.045)^7
= $12,000 x 1.347675
= $16,171.10

The best balance, rounded to two decimal places, after investing $12,000 for a period of 7 years is $16,171.10.