idk how to do it hoenstly
#compound interedt
placid iris
polar hull
idk how to do it hoenstly
so for bank b, how do you think you could work out the total you're gonna get
because you have 4% for the first year, then 1% for the other years (2 because you have 2 remaining years / 3)
placid iris
so for bank b, how do you think you could work out the total you're gonna get
idk do u work out htem indivduallyl then add them together
or like
5000 x 1.004^3?
idkk
polar hull
idk do u work out htem indivduallyl then add them together
exactly this
placid iris
5000 x 1.004^3?
is this right
polar hull
for the first year, it's just 5000 x 1.04
polar hull
then you have 2 more years
so we then take the new percentage we work with
which is gonna be 1%, which is 1.01
so then because it's 2 more years
placid iris
1.04 x 5000 = 5200
and then 1.01^2 x 5000 = 5100.50
wiat im confused bank a makes less money
polar hull
yeah
placid iris
okay
polar hull
oh it's 1% based on the amount you get in the first year
placid iris
huhhh
polar hull
so 5200 x 1.01²
polar hull
wait she doesn't
placid iris
wait for the 2nd one
huhh
so its 1.04 x 5000 = 5200 for 1st one fright and then 1.01^2 x 5200 is 5304.52 but idk cause bank a is uspposed to make more
polar hull
oh wait no I didn't read the flipping question 😭
polar hull
so its 1.04 x 5000 = 5200 for 1st one fright and then 1.01^2 x 5200 is 5304.52 b...
what no
polar hull
okay let me explain
placid iris
ok
polar hull
Bank A:
2.5% for 3 years
therefore 5000 × 1.025³
placid iris
mhm
placid iris
1.01^2 x 5200?
polar hull
so 5200 x 1.01² = 5304.52
placid iris
okay
polar hull
we used the answer to the 1st year as the number we multiply by the percentage^n for the remaining 2 years
placid iris
so i justy minus a with all othe ryrds one
polar hull
because it's compounded
polar hull
so i justy minus a with all othe ryrds one
you do 5384.45 - 5304.52