livvi invests $19,430 in a savings account at...
livvi invests $19,430 in a savings account at her local bank which pays 1.8% simple annual interest. she also deposits $16,470 in an online savings account which pays 2.7% simple annual interest. after six years, which account will yield more interest, and approximately how much more interest will it yield? a. the online account will give $2,668 more interest. b. the online account will give $570 more interest. c. the local account will give $2,960 more interest. d. the local account will give $2,390 more interest. please select the best answer from the choices provided
Answer
# Explanation:
## Step1: Calculate local - bank interest
The simple - interest formula is $I = Prt$, where $P$ is the principal amount, $r$ is the annual interest rate (in decimal form), and $t$ is the time in years. For the local bank, $P_1=19430$, $r_1 = 0.018$, and $t = 6$. So, $I_1=P_1r_1t=19430\times0.018\times6=19430\times0.108 = 2098.44$.
## Step2: Calculate online - bank interest
For the online bank, $P_2 = 16470$, $r_2=0.027$, and $t = 6$. So, $I_2=P_2r_2t=16470\times0.027\times6=16470\times0.162 = 2668.14$.
## Step3: Find the difference in interest
$I_2 - I_1=2668.14−2098.44 = 569.7\approx570$.
# Answer:
B. The online account will give $570 more interest.