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

For simple interest, the formula to calculate the final balance is:
Final Balance = Principal + (Principal * Rate * Time)

Using this formula, the final balance with simple interest would be:
Final Balance = $12,000 + ($12,000 * 0.05 * 7)
Final Balance = $12,000 + ($6,300)
Final Balance = $18,300

For compound interest, the formula to calculate the final balance is:
Final Balance = Principal * (1 + Rate)^Time

Using this formula, the final balance with compound interest would be:
Final Balance = $12,000 * (1 + 0.045)^7
Final Balance = $12,000 * (1.045)^7
Final Balance = $12,000 * 1.34985710626
Final Balance = $16,198.29

Therefore, the best balance after investing $12,000 for a period of 7 years, considering the interest earned, would be $16,198.29.

Answer 2

wrong

Answer 3

I apologize for the mistake. Let me recalculate the correct answer.

For simple interest:
Final Balance = Principal + (Principal * Rate * Time)
Final Balance = $12,000 + ($12,000 * 0.05 * 7)
Final Balance = $12,000 + ($4,200)
Final Balance = $16,200

For compound interest:
Final Balance = Principal * (1 + Rate)^Time
Final Balance = $12,000 * (1 + 0.045)^7
Final Balance = $12,000 * (1.045)^7
Final Balance = $12,000 * 1.349627

Rounded to two decimal places, the best balance after investing $12,000 for a period of 7 years is $16,195.52.