1. (07.01 MC) Harrison and Sherrie are making decisions about their bank accounts. Harrison wants to deposit $200 as a principle amount, with an
interest of 2% compounded quarterly. Sherrie wants to deposit $200 as the principle amount, with an interest of 4% compounded
monthly. Explain which method results in more money after 2 years. Show all work.

"Compounded monthly" is the correct approach.

Step-by-step explanation:

Harrison,

Given that:

Principle,

P = $200

Interest rate,

R = 2%

Compounded quarterly,

R =

  =

After 2 years, the amount (A) will be:

=

By putting the values, we get

=

=

= ($)

Sherrie,

Given that,

Principle (deposited),

P = $200

Interest rate,

R = 4%

After 2 years, the amount (A) will be:

=

=

= ($)

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