Question

If the principal is $300 rate 3% time 4 years then what is the interest earned and the new balance

Answer 1

a) Interest earned = $36

New Balance = $336

b) Interest rate = 0.05 or 5%

New Balance = $517.5

c) time t = 5

New Balance = $612.5

d) Principal Amount = $675

New Balance = $783

Explanation:

We are given:

a) Principal (P) = $300

Rate (r) = 3% or 0.03

Time (t)= 4 years

Interest earned = ?

The formula used is:
`Simple \ Interest (I)= P* r* t`

Putting values and finding interest

`Simple \ Interest (I)= P* r* t\\Simple \ Interest (I)= 300* 0.03* 4\\Simple \ Interest (I)= 36`

So, Interest earned = $36

New Balance = Principal + Interest = 300+36 = $336

b) a) Principal (P) = $300

Rate (r) = ?

Time (t)= 3 years

Interest earned = 67.50

The formula used is:
`Simple \ Interest (I)= P* r* t`

Putting values and finding rate

`Simple \ Interest (I)= P* r* t\\67.50= 450* r* 3\\67.50=1350* r\\r=(67.50)/(1350)\\r=0.05 \ or \ 5\%`

So, Interest rate = 0.05 or 5%

New Balance = Principal + Interest = 450+67.50 = $517.5

c) Principal (P) = $500

Rate (r) = 4.5% or 0.045

Time (t)= ?

Interest earned = $112.50

The formula used is:
`Simple \ Interest (I)= P* r* t`

Putting values and finding time

`Simple \ Interest (I)= P* r* t\\112.50= 500* 0.045* t\\112.50=22.5 * t\\t=(112.50)/(22.5)\\t=5`

So, time t = 5

New Balance = Principal + Interest = 500+112.50 = $612.5

d) Principal (P) = ?

Rate (r) = 8% or 0.08

Time (t)= 2 years

Interest earned = 108.00

The formula used is:
`Simple \ Interest (I)= P* r* t`

Putting values and finding Principal

`Simple \ Interest (I)= P* r* t\\108=P* 0.08 * 2\\108=P* 0.16\\P=(108)/(0.16)\\P=675`

So, Principal Amount = $675

New Balance = Principal + Interest = 675+108 = $783