Question

Jake invested $7,500 in a 5-year CD that

pays 3.9% simple interest annually. How
much interest will the CD earn in 5 years?
A $292.50
B $1,462.50
C$7,792.50
D $8,962.50

Answer 1

D. $8,962.50

P stands for principal

R stands for rate

T stands for time

A=$7,500(1+ (0.039×5))=$8,962.5

A=$8,962.50

So Jake will have $8,962.50 of interest after 5 years.