Question

Sally deposited money into a savings account paying 4% simple interest per year.The first year,She earn $75 in interest.How much interest will she earn during the following year?

Answer 1

Answer: She will earn $900 during the following year.

Explanation:

Since we have given that

Rate of interest = 4%

Interest = $75

Let the Principal be x

As we know the formula for "Simple Interest":

`S.I.=(P* R* T)/(100)\\\\75=(P* 4* 1)/(12* 100)\\\\75* 100* 12=4* P\\\\(75* 100* 12)/(4)=P\\\\25* 75* 12=P\\\\\$22500=P`

So, Interest earned during the following year will be

`I=(P* R* T)/(100)\\\\I=(22500* 4* 1)/(100)=\$900`

Hence, She will earn $900 during the following year.