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You want to put some money in a simple interest account. It pays 6% interest annually for 2 years. You would like to earn $750 in interest. How much money do you need to put in?
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4 votes
You want to put some money in a simple interest account. It pays 6% interest annually for 2 years. You would like to earn $750 in interest. How much money do you need to put in?

User Salman Hasrat Khan
by
6.3k points

2 Answers

3 votes

Answer:

6250

Explanation:

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User Firas Al Mannaa
by
7.5k points
7 votes
Let present value = P
interest rate, i = 0.06
time = 2 years
interest amount = 750
then
750 = Pin = P(0.06*2)
Solve for P
P=750/(0.06*2) = $6250

Answer: $6250 must be deposited to earn the desired interest.
User Satiago
by
7.3k points
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