Question

A principal of $950 is invested in an account at 7 percent simple interest per year. What is the amount of the principal after 5 years?

Be careful! What term of the simple interest sequence tells you the principal after 1 year? What term of the simple interest sequence tells you the principal after 5 years?

Answer 1

`\bf ~~~~~~ \textit{Simple Interest Earned Amount} \\\\ A=P(1+rt)\qquad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\to& \$950\\ r=rate\to 7\%\to (7)/(100)\to &0.07\\ t=years\to &5 \end{cases} \\\\\\ A=950(1+0.07\cdot 5)\implies A=950(1.35)\implies A=1282.5`