+1452 Cedric has deposited $12,000 into an account that pays 5% interest compounded annually. Daniel has deposited $12,000 into an account that pays 7% simple annual interest. In 15 years Cedric and Daniel compare their respective balances. To the nearest dollar, what is the positive difference between their balances?
Thanks!
Edit: Anyone?
+118687 Cedric has deposited $12,000 into an account that pays 5% interest compounded annually. Daniel has deposited $12,000 into an account that pays 7% simple annual interest. In 15 years Cedric and Daniel compare their respective balances. To the nearest dollar, what is the positive difference between their balances?
Balances after 15 years:
Cedric
\(12000(1+0.05)^{15}=12000*1.05^{15}=$24,947.14\)
Daniel:
interest = PRT = 12000*0.05*15=$9000
End amount = 12000+9000 = $23000
So the difference is $24,947 - $23000 = $1947
Edit:
I have worked Daniels out on 5% instead of 7%.
You can make the required adjustment.
