Question

alex invests $200 for 2 years at a rate of 2% per year simple interest
christ invests $200 for 2 years at a rate of 2% per year compound interest
calculate how much more interest christ has then alex​

Answer 1

S I

P = $200

T = 2 years

R = 2%

SI = P * R * T /100

SI = $200 * 2* 2 / 100

SI = $8

Compound interest

P= $200

R= 2 %

T = 2 years

Amount = P(1+R/100) ^ T

A = $200 ( 1+ 2/100) ^ 2

= $200 * (102/100)^2

= 200 * 10404 /10000

= $208.08

CI = A-P

208.08 -200

$ 8.08

So total extra money to be paid

CI - SI

8.08 - 8 = $0.8

$0.8 have to be paid more if took compound interest