Question

James invests £200 for 1 year in a bank account. This account pays simple interest at a rate of 3% per year. Work out the total amount of money in the account at the end of the year​

Answer 1

To calculate the total amount in James's bank account after 1 year, you add the simple interest (£6, which is £200 multiplied by 3% for one year) to his initial £200 investment, resulting in £206.

Step-by-step explanation:

Calculating Simple Interest and the Total Amount

To calculate the simple interest that James's investment will earn, we use the simple interest formula:

Simple Interest = Principal × Rate × Time

In this case, the principal amount (P) is £200, the annual interest rate (r) is 3% or 0.03 when expressed as a decimal, and the time period (t) is 1 year.

Simple Interest = £200 × 0.03 × 1 = £6

Now, to find out the total amount in the account at the end of the year, we need to add the simple interest to the original principal amount:

Total Amount = Principal + Simple Interest

Total Amount = £200 + £6 = £206

Therefore, the total amount of money in James's account at the end of the year is £206.

Answer 2

`~~~~~~ \textit{Simple Interest Earned Amount} \\\\ A=P(1+rt)\qquad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\dotfill & \pounds 200\\ r=rate\to 3\%\to (3)/(100)\dotfill &0.03\\ t=years\dotfill &1 \end{cases} \\\\\\ A = 200[1+(0.03)(1)] \implies A = 206`