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**Unformatted text preview: **b) How much interest will the saver earn if the interest is withdrawn each year? They would earn $40; $1,000 x 1.04 per year 20 years x $40 = $800 c) Why are the answers to a and b different? because in part a the interest principal amount increases yearly , it is like interest deposit. In part b interest principal is always 1000....

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