EXPLAIN IM CONFUSED , PLEASE!!
would you make more intrest by investing $5,000 in a 6-month certificate of deposit (CD) at 6% intrest or by investing $3,000 in a 12-month CD at 4% intrest EXPLAIN

Question

EXPLAIN IM CONFUSED , PLEASE!!
  would you make more intrest by investing $5,000 in a 6-month certificate of deposit (CD) at 6% intrest or by investing $3,000 in a 12-month CD at 4% intrest EXPLAIN

anonymous · Answer

monthly

cwtan · Answer

Assume it is a geometrical series
a=5000
r=1.06
and we want to find the 6th Term
5000(1.06)^6=7092.60
so it gain 2092.60

a=3000
r=1.04
10th Term
3000(1.04^10)=4440.73
so it gain only 1440.73
so the 1st one gain more interest

cwtan · Answer

Oops it's 12th term for the 2nd one
sorry i make a mistake
3000(1.04)^12=4803.10
gain 1803.10