An investment of $2,000 is earning interest at the rate of 6.2% compounded quarterly over 5 years. Approximately how much interest is earned on the investment?
a.
$724.67
b.
$2127.72
c.
$720.37
d.
$2720.37

Question

An investment of $2,000 is earning interest at the rate of 6.2% compounded quarterly over 5 years. Approximately how much interest is earned on the investment?
a.
$724.67
b.
$2127.72
c.
$720.37
d.
$2720.37

anonymous · Answer

The same amount of principal is invested in different accounts earning the same interest rate. Which of the following accounts would have the greatest accumulated value at the end of one year?
a.
An account earning no interest
b.
An account earning simple interest
c.
An account earning interest compounded annually
d.
An account earning interest compounded daily