Problem
You deposit $4000 into a bank account paying 3% simple interest per year. You left the money in for 4 years. How much interest do you get at the end of those 4 years?
Result
The interest is $480.
Explanation
Find an interest by using the formula I=P⋅i⋅t, where I is interest, P is total principal, i is rate of interest per year, and t is total time in years.
In this examplee P = $4000, i = 3% and t = 4 years, so
III=P⋅i⋅t=4000⋅0.03⋅4=480