Aaron deposited $2,500 this morning into a bank account that
pays 3 percent interest once a year. Bella also deposited $2,500
this morning. Her account also pays 3 percent annual interest. As
soon as Aaron earns interest, he withdraws it and spends right
away. Bella reinvests her interest earnings into her bank account.
Based on this information:
Multiple Choice
Multiple Choice
-
Bella will earn more interest in Year 1 than Aaron will.
-
Bella will earn more interest in Year 2 than Aaron.
-
Aaron's earned interest will be compound interest.
-
Aaron will earn more interest in Year 3 than Bella will.
-
After five years, Aaron's earned interest amount will be the
same as Bella's earned interest amount.
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