Oscar the Grouch is trying to determine what would be the better investment for his savings of $5200. The Sesame Street Bank is offering a Term Deposit (simple interest) of 6%pa with the term deposit coming to fruition at the end of 3 years. Bank of Disney is offering a compound interest of 5.9%pa, compounded daily, with the interest rate being guaranteed for 3 years. a) Which bank would be the better investment for Oscar?Justify your answer. b)An emergency has arisen and Oscar the Grouch needs his money at the end of second year. How much money would Oscar receive if he withdrew his money after 2 years? c) Oscar was able to reinvest $6000 in the Australian Bank and after 5 years received $7657.60 back. Assuming an annual compounding period, what was the interest rate that Oscar was earning (to the nearest whole number)?
Oscar the Grouch is trying to determine what would be the better investment for his savings of $5200. The Sesame Street Bank is offering a Term Deposit (simple interest) of 6%pa with the term deposit coming to fruition at the end of 3 years. Bank of Disney is offering a
a) Which bank would be the better investment for Oscar?Justify your answer.
b)An emergency has arisen and Oscar the Grouch needs his money at the end of second year. How much money would Oscar receive if he withdrew his money after 2 years?
c) Oscar was able to reinvest $6000 in the Australian Bank and after 5 years received $7657.60 back. Assuming an annual compounding period, what was the interest rate that Oscar was earning (to the nearest whole number)?
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