Avery wants to buy a car and has a choice between two different banks. One bank is offering a simple interest rate of 3.2% and the other bank is offering a rate of 3% compounded annually. If Avery decides to deposit $7,000 for 5 years, which bank would be the better deal? 1. a simple interest rate of 3.2% 2. a compound interest rate of 3%

a simple interest rate of 3.2% will be the better deal.

Step-by-step explanation:

Hi, to answer this question we have to apply the compounded interest formula:  

A = P (1 + r/n) nt  

Where:  

A = Future value of investment (principal + interest)  

P = Principal Amount  

r = Nominal Interest Rate (decimal form, 3/100= 0.03)  

n= number of compounding periods in each year (1)  

Replacing with the values given  

A = 7000 (1+0.03/1)^(1x5)

A = 7000( 1.03)^5 = $8,114.92

For simple interest:

I = p x r x t  

Where:  

I = interest  

Replacing with the values given:

I = 7000 x (3.2/100) x 5 = $1,120

Adding the principal amount: 7000+1120 = $8,120

Since 8,120 (simple) >8,114.92(compound)

a simple interest rate of 3.2% will be the better deal.

answer: the sun

explanation:

water cycle describes the evaporation of water from earth's surface, formation of clouds and precipitation water back onto the surface of earth. seventy percent of the earth is covered with water in the form of seas and oceans. the heat of the sun causes the evaporation of water from the surface of the ocean. the water vapors rise and condense to form water droplets. the collection of these water droplets form clouds which rain down again.

the evaporation of the oceans surface water as part of the water cycle is caused by the sun