Question

Two brothers Tom and Alan each inherited $39,000 Tom invested his inheritance in a savings account with an annual return of 2.9% while Alan invested his inheritance in a CD paying 5.7% annually how much more money than Tom does Allen have after one year

Answer 1

Given:

Two brothers Tom and Alan each inherited $39,000 Tom invested his inheritance in a savings account with an annual return of 2.9% while Alan invested his inheritance in a CD paying 5.7% annually

Required:

How much more money than Tom does Allen have after one year

Explanation:

It appears that the interest rate is simple interest, that is calculated at the end of each year.

If that is case in Tom

Initial money=$39000

% increased per annum =2.9%

money gained per annum=

$39000\times\frac{2.9}{100}=\text{ \ 1131}$

If that is case in Allen

Initial money =$39000

%increased per annum=5.7%

money gained per annum=

$39000\times\frac{5.7}{100}\text{ =\ 2223}$

So from above calculation we conclude

Allen has $ (2223-1131)= $1192 more than Tom

Required answer:

Allen ($1192 more dollar)