Anne deposited $500 in an account that earns 6% simple annual interest. shelly deposited $500 in an account that earns 6% annual interest compounded annually. they leave the money in the account for 4 years. which statement is true about the two investments after 4 years?

It is clear that, The Shelly account is $11.23 more than that in Anne account .

Step-by-step explanation:

Given as :

For Anne

The amount deposited in account = p = $500

The rate of interest = r = 6%  at simple interest

The time period of deposit = t = 4 years

Let The amount received in account after 4 years = $

From Simple Interest method

Simple Interest =

Or, s.i =

Or, s.i =

Or, s.i =

i.e s.i = $120

∵ Amount = Principal + Interest

Or, = p + s.i

Or = $500 + $120

Or, Amount = $620

So, The Amount in Anne account after 4 years is $620

Again

For, Shelly

The amount deposited in account = P = $500

The rate of interest = R = 6% compounded annually

The time period of deposit = T = 4 years

Let The amount received in account after 4 years = $

From Compound Interest method

Amount = Principal ×

Or, = P ×

Or, = $500 ×

Or, = $500 ×

Or, = $500 × 1.26247

Or, = $631.23

So, The amount received by Shelly in her account after 4 years = $631.23

Now, Difference between amount received in their account

i.e   -   = $631.23 - $620

Or, -   = $11.23

Hence, It is clear that, The Shelly account is $11.23 more than that in Anne account . Answer

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