Answer:
Step-by-step explanation:
We would apply the formula for determining compound interest which is expressed as
A = P(1+r/n)^nt
Where
A = total amount in the account at the end of t years
r represents the interest rate.
n represents the periodic interval at which it was compounded.
P represents the principal or initial amount deposited
Considering the investment compounded annually,
From the information given,
P = 9000
r = 8% = 8/100 = 0.08
n = 1 because it was compounded once in a year.
t = 12 years
Therefore,
A = 9000(1 + 0.08/1)^1 × 12
A = 9000(1.08)^12
A = $22664
For the second investment,
n = 6
Therefore,
A = 9000(1 + 0.08/6)^6 × 12
A = 9000(1 + 0.0133)^72
A = 9000(1.0133)^72
A = $23301
The second investment gave higher returns.
