Question

Larry and Peggy are making decisions on their bank accounts. Larry wants to put the original money in an account with a higher interest rate. Peggy wants to put more money in as a principle amount because the more you start with, the more interest you will gain. Explain which method will result in more money.

Answer 1

It is impossible to say without some numbers, and whether the interest is simple or compounding.

With simple interest, they are proportional: I=Prt
So double the interest rate will have the same effect as double the principle.

Answer 2

I don't see how to do this, sorry. :/

Answer 3

I think I can come up tih my own examples like if it were 2% or 5%... im pretty sure that's what its telling me that you can choose your own numbers

Answer 4

@hero do you think you could help

Answer 5

Larry and Peggy are making decisions on their bank accounts. Larry wants to put the original money in an account with a higher interest rate. Peggy wants to put more money in as a principle amount because the more you start with, the more interest you will gain. Explain which method will result in more money.

Larry would prefer:

f(0.4) = 20 + 20(0.4)

Peggy would prefer:
f(0.2) = 40 + 40(0.2)

Answer 6

yes so they can both make the same money?

Answer 7

Solve it.
f(0.4) = 20 + 8
f(0.4) = 28

Now you solve the other one.

Answer 8

Okay look, f(0.4) = 20 + 8 means he gets 8 dollars in interest.
f(0.2) = 40 + 40(0.2)
f(0.2) = 40 + 8
So they make the same amount of money.

Answer 9

ok thank you

Answer 10

No problem.