Question

What is the simple interest of 8000 for 2.5 years at 4.25%

Answer 1

We are going to find the simple interest of $8000, for 2.5 years, at 4.25%. We remember that the formula for the simple interest is given by:

`I=Prt`

Where P represents the principal value, r the interest rate, and t the time in years. For finding the simple interest, we will replace the values given onto the formula:

`I=(8000)\cdot(0.0425)\cdot(2.5)`

Given that 4.25% is equivalent to the value 0.0425, and we obtain:

`\begin{gathered} I=340\cdot2.5 \\ =850 \end{gathered}`

This means that the simple interest is $850.