Question

Raina deposits $5000 into an account that pays simple interest at a rate of 2% per year. How much interest will she be paid in the first 2 years?

Answer 1

Raina will be paid $200 interest in the first 2 years. This is because she is paid a simple interest rate of 2% and 2% of 5000 is 100. As it's for two years, you need to multiply the first year's interest by 2 to get the total interest over two years.