Question

How much interest would you earn investing $200.00 at 5% for 2 years

Answer 1

5% of 200 is $10 multiplied by 2 years and you get $20 in interest. The total amount ends up being $220

Answer 2

The interest is $20 and the amount is $220.

STEP 1: Find an interest by using the formula I=P⋅i⋅t, where I is interest, P is total principal, i is rate of interest per year, and t is total time in years.In this examplee P = $200, i = 5% and t = 2 years, soIII=P⋅i⋅t=200⋅0.05⋅2=20STEP 2: Find an amount by using the formula A=P+I.Since P = $200 and I = $20 we haveAAA=P+I=200+20=220


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