Answer to Question #161173 in Financial Math for Hekl

Question

Which annuity will earn the greater amount at the end of 2 years?

Justify your answer.

a) $50 at the end of every week at 5%/a compounded weekly

b) $2600 at the end of every year at 5%/a compounded annually

Answer 1

b)will earn greater amount because the principal amount is higher than a) $50