Question

Pam open a bank account with $200 deposit that account had a simple interest rate of 4.6% her most recent bank statement shows a balance of $328.80 if she made no deposits or withdrawals how long ago was the account opened ?

Answer 1

`t=14\ years`

Explanation:

we know that

The simple interest formula is equal to

`A=P(1+rt)`

where

A is the Final Investment Value

P is the Principal amount of money to be invested

r is the rate of interest

t is Number of Time Periods

in this problem we have

`t=?\ years\\ P=\$200\\ A=\$328.80\\r=0.046`

substitute in the formula above and solve for t

`328.80=200(1+0.046t)`

`(328.80/200)=(1+0.046t)`

`t=[(328.80/200)-1]/0.046`

`t=14\ years`