ashley invests $9,720 in a one - month money market account paying 3.16% simple annual interest and $8,140…

ashley invests $9,720 in a one - month money market account paying 3.16% simple annual interest and $8,140 in a two - year cd yielding 3.23% simple annual interest. assuming ashley does not reinvest or renew these investments, how much money will she have when both investments reach maturity, to the nearest dollar?\na. $550\nb. $1,080\nc. $17,310\nd. $18,411\nplease select the best answer from the choices provided

ashley invests $9,720 in a one - month money market account paying 3.16% simple annual interest and $8,140 in a two - year cd yielding 3.23% simple annual interest. assuming ashley does not reinvest or renew these investments, how much money will she have when both investments reach maturity, to the nearest dollar?\na. $550\nb. $1,080\nc. $17,310\nd. $18,411\nplease select the best answer from the choices provided

Answer

Explanation:

Step1: Calculate interest for money - market account

The simple - interest formula is $I = Prt$. For the money - market account, $P_1=$9720$, $r_1 = 0.0316$ (3.16% as a decimal), and $t_1=\frac{1}{12}$ years. $I_1=P_1r_1t_1=9720\times0.0316\times\frac{1}{12}$ $I_1 = 9720\times\frac{0.0316}{12}=9720\times0.002633\approx25.5$ The amount in the money - market account $A_1=P_1 + I_1=9720 + 25.5=$9745.5$

Step2: Calculate interest for CD

For the CD, $P_2 = 8140$, $r_2=0.0323$ (3.23% as a decimal), and $t_2 = 2$ years. $I_2=P_2r_2t_2=8140\times0.0323\times2$ $I_2=8140\times0.0646 = 525.844$ The amount in the CD $A_2=P_2 + I_2=8140+525.844=$8665.844$

Step3: Calculate total amount

The total amount $A = A_1+A_2=9745.5 + 8665.844=$18411.344\approx$18411$

Answer:

D. $18,411$