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Bonnie deposits $70.00 into a new savings account. The account earns 4.5% simple interest per year. No money is added or removed form the savings account for 3 years. What is the total amount of money in her savings account at the end of the 3 years

2 Answers

6 votes

Final answer:

After 3 years, Bonnie's $70 deposit in a savings account at a 4.5% simple interest rate would earn $9.45 in interest, resulting in a total amount of $79.45 in the account.

Step-by-step explanation:

Calculating Simple Interest

Bonnie deposits $70.00 into a new savings account, which earns a 4.5% simple interest rate every year. After 3 years, without any additional deposits or withdrawals, we can calculate the simple interest earned using the formula Interest = Principal × Rate × Time.

In Bonnie's case, the principal amount is $70.00, the rate is 4.5% (or 0.045 when converted to a decimal), and the time is 3 years. Plugging these values into the formula:

Interest = $70.00 × 0.045 × 3 = $9.45

This means that the total simple interest earned over 3 years is $9.45. To find the total amount in the savings account after 3 years, we simply add the interest to the initial deposit:

Total Amount = Principal + Interest

Total Amount = $70.00 + $9.45 = $79.45

Therefore, the total amount of money in Bonnie's savings account at the end of 3 years will be $79.45.

User Buddhima Udaranga
by
5.6k points
3 votes

Answer:

The amount in the account would be 79.45

Step-by-step explanation:

To determine the amount that will be in the account, we can use the simple interest equation.

A = P + Prt

A = 70 + 70(.045)(3)

A = 70 + 9.45

A = 79.45

User Sprachprofi
by
5.3k points