Question

Last year, Josh opened an investment account with $5800. . At the end of the year, the amount in the account has increased by 6.5%. How much is this increase in dollars? How much money was in his account at the end of last year?

Answer 1

$377, $6177

Explanation:

Sounds like simple interest (interest added to the account at the end of each year).

Here the interest earned would be:

i = $5800*0.065*1, where the '1' represents 1 year. This comes out to $377.

Adding this to the $5800 principal, we get the end-of-year amount $6177.