Question

Tahmar knows the formula for simple interest is I = Prt, where I represents the simple interest on an amount of money, P, for t years at r rate. She transforms the equation to isolate P : P = . Using this formula, what is the amount of money, P, that will generate $20 at a 5% interest rate over 5 years?

Answer 1

Answer: 80

Step-by-step explanation: The given formula is: P = I/rt. So, we'll plug in $20, 5%, and 5 years like this: P = 20/5%(5) (or for the 5%, you can put .05), you will get: 80. You can get that answer on your calculator as well.

Hope this helped :)

Answer 2

$80

Working
Making p the subject gives:
P=
`(I)/(rT)`
Substituting for values of I, r and t
p=
`(20)/(0.05*5)`
p=80 dollars