Question

Michelle deposited $1,385 into a savings account with a simple interest rate of 2.89% per year. If Michelle does not touch the funds for 7 years, what will her balance be?

Answer 1

$1,665.19

Explanation:

Interest=PRT/100 where P is the principal amount deposited by Michelle, R is the rate offered per year in terms of percentage, T is the period in years

Substituting P for $1385, T for 7 years, R for 2.89% we obtain interest as follows

Interest=$1,385*2.89*7 years/100=$280.1855

Balance after 7 years will be the sum of principal amount and interest gained

Balance=$1,385+$280.1855 =$1,665.1855

Rounding off to 2 decimal places

Balance=$1665.19

Therefore, Michelle's balance is $1,665.19