Over 2 years, how much more does $2000 in a savings account with an apr of 4.6 compounded semiannually earn in interest than the same amount in a savings account with an apr of 4.4% compounded quarterly? a. $3.76 b. $1.88 c. $7.52 d. $15.04

C. $7.52

To solve this, we are going to use the compounded interest formula:

where

is the final amount after years

is the initial investment

is the interest rate in decimal form

is the number of times the interest is compounded per year

is the time in years

We know that the initial investment is $2000 and the time is 2 years, so and . Now, for the the first account and ; for the second account and . Let's calculate for both accounts:

For the first account

For the second account

Now we just need to subtract the total amount of the second account from the total amount of the first account:

$2190.45 - $2182.93 = $7.52

The account of 4.6 compounded semiannually earn $7.52 more than the account of 4.4% compounded quarterly.

step-by-step explanation:

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