Question
A bank offers two types of savings accounts:
Account A: 3.5% simple interest per year.
Account B: 3.3% compound interest per year.
[12 marks]
Account A: 3.5% simple interest per year.
Account B: 3.3% compound interest per year.
(a)Calculate the balance of $5000 in Account A after 5 years.[3]
(b)Calculate the balance of $5000 in Account B after 5 years.[3]
(c)After how many complete years will the balance in Account B first be greater than the balance in Account A?[4]
(d)An exchange rate is 1 USD = 0.92 EUR. Convert the total amount in Account B after 5 years into EUR, giving your answer to the nearest Euro.[2]
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