Compounding: Trish Harris Has Deposited $2,500 Today in an Account

question 21

Multiple Choice

Compounding: Trish Harris has deposited $2,500 today in an account paying 6 percent interest annually. What would be the simple interest earned on this investment in five years? If the account paid compound interest, what would be the interest-on-interest in five years?

• A) $750; $95.56
• B) $150; $845.56
• C) $150; $95.56
• D) $95.56; $845.56

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Definitions:

Solutions

Methods or processes for solving problems or dealing with difficult situations, often involving a detailed, step-by-step procedure for achieving a desired end.

Interaction

The reciprocal action or influence between entities, leading to a dynamic process of exchange or communication.

Descartes's Views

Philosophical opinions of Descartes that emphasize doubt as the basis for certainty and the dualism of mind and body as foundational to understanding existence.

Spinoza's Views

The philosophical perspectives of Baruch Spinoza, which include the monist idea that everything is one substance, often identified with God, and the ethical importance of living a life of rationality and self-control.