Question

How much should you invest at 5% simple interest in order to have a balance of 1,200 in two and a half years

Answer 1

We should invest 9600 .

Explanation:

Interest received in Two and a half year = 1,200

So, Interest that should be received in a year = 1200×
`(2)/(5)`

= 480

Interest rate = 5%.

Let we had invested amount X.

Thus 5 % of X we will get in a year as interest

Which is
`(5)/(100)`×X =
`(X)/(20)`.

It is also equal to 480 as calculated above,

So. X = 480×20 = 9600.

Thus,

We should invest 9600 .