Therefore I earn $50 interest
Therefore I earn $30.88 interest.
I would do the first one.
Step-by-step explanation:
A.
Given , I invested $500 at 5% simple interest for 2 years.
P=$500, Â r =5% and t = 2 years
[tex]Interest (I) =\frac{P \times r \times t}{100}[/tex]
         [tex]=\$\frac{500 \times 5 \times 2}{100}[/tex]
          =$50
Therefore I earn $50 interest.
B.
Given , I invested $500 at 3% compounded monthly for 2 years.
P=$500, Â r =3% = 0.03 and t = 2 years
[tex]Amount (A) =P(1+\frac{r}{n})^{nt}[/tex] Â
          [tex]=\$500(1+\frac{0.03}{12})^{ 2\times 12}[/tex]
          =$530.88
Interest = $(530.88-530) = $30.88
I would do the first one.
