Answer: William will pay $ 330.76 more interest than Shani at the end of 3 years.
Step-by-step explanation:
Compound interest = [tex]P((1+r)^t-1)[/tex] , P= principal , r= rate of interest , t= time
Given: P = $5000 , t= 3 years
For Shani , r= 4% = 0.04
Compound interest = [tex]5000((1+0.04)^3-1)[/tex]
[tex]=5000(1.124864-1)\\\\=5000(0.124864)\\\\=\$\ 624.32[/tex]
For William, r= 6%= 0.06
Compound interest = [tex]5000((1+0.06)^3-1)[/tex]
[tex]=5000(1.191016-1)\\\\=5000(0.191016)\\\\=\$\ 955.08[/tex]
Difference = $ ( 955.08- 624.32)
= $ 330.76
Hence, William will pay $ 330.76 more interest than Shani at the end of 3 years.
