IV. EXERCISES Direction : Analyze the problem given below, illustrate the two investments and compare simple and compound interest. 1. Mr. Pablo received his backpay from a work abroad and wanted to quit as an OFW. He received P150 000.00. He plans to invest it for 5 years. An ABC bank offers him with 2% simple interest rate per year while the UNION bank offers him 2% compounded annually. If you were Mr. Pablo which offer will you choose and why?
I will choose Compounded If you invested $10,000 which compounded annually at 5%, it would be worth over $40,000 after 30 years, accruing over $30,000 in compounded.
