Investigate the difference between compounding annually and simple interest for parts a–j.
a. Find the simple interest for a one-year CD for $5,000 at a 2.5% interest rate.
b. Find the interest for a one-year CD for $5,000 at an interest rate of 2.5%, compounded annually.
c. Compare the results from parts a and b.
Select
d. Find the simple interest for a three-year CD for $5,000 at an interest rate of 2.5%.
e. Find the interest for a three-year CD for $5,000 at an interest rate of 2.5%, compounded annually.
f. Compare the results from parts d and e.
Select
g. Find the simple interest for a six-year CD for $5,000 at an interest rate of 2%.
h. Find the interest for a six-year CD for $5,000 at an interest rate of 2%, compounded annually.
i. Compare the results from parts g and h.
Select
