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Sequence and Series - Simple Interest

Sequence and Series - Simple Interest

Secondary 3

The following table shows the different plans offered by two banks for an investment.

Alvin decides to invest \(\$8600\) for \(5 \frac{1}{2}\) years in either one of the investment plans offered by the banks.

BankInvestment plan
\(A\)Simple interest at the rate of \(3.7\%\) per year.
\(B\)Compound interest at the rate of \(3.5\%\) per year compounded half-yearly.
  1. Calculate the amount of interest earned when Alvin invests in
    1. Bank \(A\).
    2. Bank \(B\).
  2. Hence, state the bank that Alvin should invest his money in.

Solution:

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Answer:(a)(i) \(\$1750.1\) (ii) \(\$1808.23\) (b) Bank B

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