Answer:
Option A.
Explanation:
You would use the equation [tex]A = P(1+\frac{r}{n}) ^{nt}[/tex]. A is your final value, r is the interest rate (0.07 for the 7% interest rate), n is how many times it is compounded annually, and t is the amount of years. (edit) I forgot to clarify that P is the starting value, which is $4000 in this case.
Compare the two final values, Option A is $5659.11, Option B is $6138.75.
Option A is correct because it is cheaper.
