Question

Lehana and Marty each opened a savings account with a deposit of $100. Lehana earned 2.5% simple interest per year. Marty earned 2% simple interest per year. Neither of them made additional deposits or withdrawals. How much more did Lehana receive in interest than Marty after three years?

Answer 1

100*.025*3=7.5 100+7.5=107.5
100*.02*3=6 100+6=106
107.5-106=1.5
$1.50

Answer 2

Answer: $1.5

Explanation:

Given : Lehana and Marty each opened a savings account with a deposit of $100

Thus, Principal amount is same for both P= $100

Time t=3 years

Rate of interest for Lehana
`r_1=2.5\%=0.025`

Rate of interest for Marty
`r=2\%=0.002`

Difference between the simple interest = S. I. for Lehana- S.I. for Marty

`=Pr_1t-Pr_2t\\= Pt(r_1-r_2)\\=100\cdot3(0.025-0.02)\\=300(0.005)=1.5`

Hence, Lehana receive $1.5 more in interset than Marty after 3 years.