We are asked to find the simple interest associated with a principal of 5480 , an annual rate of 0.04 (4%) and at the end of 7 years:
We use the simple interest formula:
I = P r t
in our case: I = (5480) (0.04) (7) = 1534.4
So the interest is: 1534.40
We answer using two decimal places because this is refering to cents of a dollar.