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How long will it take to earn $1800 in interest if $6000 is invested at a 6% annual interest rate?

User Mycowan
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1 Answer

6 votes

Answer:

It will take 5 years.

Explanation:

Let's find how long it will take, but first let's understand the equation.

For simple interest, we use the equation:

T=(1/R)*(((A+B)/B)-1) where,

A= interest amount

B=invested money

R=interest rate (in decimal form)

T=time

Because we want to earn $1800 in interest, then A=1800.

Because we invested $6000, then B=6000.

Because we are investing under an interest rate of 6%, then R=0.06.

'How long will it take' means that T= not given, but its value is in 'years', since an annual rate was given.

Using the equation for simple interest we write:

T=(1/0.06)*(((1800+6000)/6000)-1), the solution is then:

T=5; remember, because is an annual rate, T solution means 5 years.

User Gessica
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