Question

Micheal inherited $10,000 from his uncle & is planning to invest his money for 10 years. He is considering 2 options

1) a money market account with 2.4% annual interest rate, compounded daily

2) a treasury note with 2.6% simple annual interest rate

compare these 2 investment options and determine which will pay more interest over the 10 year period. If micheal chooses the better option how much interest will he earn?

a) option 1 is better, micheal will earn more than $2700 in interest

b) option 2 is better, micheal will earn less than $2700 in interest

c) option 1 is better, micheal will earn less than $2700 in interest

d) option 2 is better, micheal will earn more than $2700 in interest

e) none

Answer #1

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