Question

The principal on Wallace Drucker’s savings account is $300. The APR is 5%. What is the simple interest after six months

Answer 1

Simple interest's formula is I = Prt. Note that 6 months is 0.5 of a year, and 5% = 0.005. So:

`I = 300(0.05)(0.5) = 7.5`

So, he would pay $7.50 interest after six months.