1MA0 Higher June 2013 Paper 2 Q14
*14 Viv wants to invest £2000 for 2 years in the same bank.
| The International Bank | The Friendly Bank |
|---|---|
| Compound Interest 4% for the first year 1% for each extra year | Compound Interest 5% for the first year 0.5% for each extra year |
At the end of 2 years, Viv wants to have as much money as possible.
Which bank should she invest her £2000 in? (4)
| Answer | Mark | Notes |
|---|---|---|
| The Friendly Bank | 4 | M1 for a correct method to find interest for the first year for either bank OR correct method to find the value of investment after one year for either bank OR use of the multiplier 1.04 or 1.05 M1 for a correct full method to find the value of the investment (or the value of the total interest) at the end of 2 years in either bank A1 for 2100.8(0) and 2110.5(0) (accept 100.8(0) and 110.5(0)) C1 (dep on M1) ft for a correct comparison of their total amounts, identifying the bank from their calculations OR M1 for either \(1.04 \times 1.01\) or \(1.05 \times 1.005\) M1 for \(1.04 \times 1.01\) and \(1.05 \times 1.005\) A1 for 1.0504 and 1.05525 C1 (dep on M1) ft for a correct comparison of their total multiplying factors identifying the bank from their calculations |