Question

You start with 5000.00. Simple interest and yields .37% APR How much interest earned in one year?

Answer 1

$1850.

Explanation:

We are asked to find amount of interest earned in one year on an amount of $5000.

We will use simple interest formula to solve our given problem.

`I=Prt`, where,

I = Amount of interest earned,

r = Annual interest rate in decimal form.

t = Time in years.

Let us convert our given interest rate in decimal form.

`37\%=(37)/(100)=0.37`

Upon substituting our given value in simple interest formula, we will get:

`I=\$5000* 0.37* 1`

`I=\$5000* 0.37`

`I=\$1850`

Therefore, an amount of $1850 is earned as interest in one year.