Question

Nathan opens a new savings account and makes an initial deposit of $400.

If the account earns 2% annual interest, how much interest will he earn in 9 months?

Answer 1

$6

Explanation:

To find how much Nathan will get in 9 months, we use the formula:

`I=Prt`

Let's break down the variables that we have.

I = ?

P = 400

r = 2% or 0.02

t = 9/12 or 0.75

The time is 0.75, because the interest is applied annually.

Now let's plug in our values to the formula.

`I=Prt`

`I=400(0.02)(0.75)`

`I=400(0.15)`

`I=$6`

Nathan will earn $6 in interest in 9 months.