A friend has $5,000 that has been saved from her part-time job. She will need her money, plus any interest earned on it, in six months and has asked for your help in deciding whether to put the money in a bank savings account at 3.5% interest or to lend it to Simone. Simone has promised to repay $5,200 after six months.

Required:

a.Calculate the interest earned on the savings account for six months.Round your answer to 2 decimal places.)

b.Calculate the annual rate of return if the money is lent to Simone.Do not round intermediate calculations. Round your answer to 2 decimal places.)

c.Which alternative would you recommend?

Lend the money to Simone.Put the money in a bank savings account.