Question

A deposit of $500 in an account earns 6% simple interest. how long will it be before the total amount is $575

Answer 1

Money stayed in the bank for 19 years 2 months and 1 day.

Find time by using the formula , where I is interest, P is total principal, i is rate of interest per year, and t is total time in years.

I = $575, P = $500 and i = 6%,

I = P • i • t

t = I
__
i • p

t = 575
________
0.06 • 500
t = 19.1667 years = 19 years 2 months and 1 day

Answer 2

Simple interest is calculated with the following formula: S.I. = P+(P × R × T), where P = Principal (initial amount) , R = Rate of Interest in % per annum, and T = Time in years, S.I. equals final amount.

575 = 500+(500 * 6% * T.)

75 = 30 T

T = 2.5 years