Question

Calculate the simple interest

and the amount.
a) $500 invested at an annual
interest rate of 2% for 1 year
b) $2750 invested at an annual
interest rate of 3.5% for 4 years
c) $4500 invested at an annual
interest rate of 6.25% for
18 months

Answer 1

$5063.75

Explanation:

a) Simple Interest = Principal x Rate x Time = $500 x 2% x 1 = $10

Amount = Principal + Simple Interest = $500 + $10 = $510b) Simple Interest = Principal x Rate x Time = $2750 x 3.5% x 4 = $385

Amount = Principal + Simple Interest = $2750 + $385 = $3135c) Simple Interest = Principal x Rate x Time = $4500 x 6.25% x 18/12 = $563.75

Amount = Principal + Simple Interest = $4500 + $563.75 = $5063.75

Correct me if I’m wrong.