Question

Julia deposited $7,500 in a 4 year certificate of deposit that pays simple

nterest at a fixed annual rate of 2.7%. What total interest will Rose have
earned at the end of the 4 years?

Answer 1

Interest = Principal (P) × Rate (R) × Time (T)

Where:

P (Principal) is the initial deposit amount: $7,500

R (Rate) is the annual interest rate: 2.7% (0.027 as a decimal)

T (Time) is the number of years: 4

Plug these values into the formula:

Interest = $7,500 × 0.027 × 4

Interest = $7,500 × 0.108

Interest = $810

So, Julia will have earned a total interest of $810 at the end of the 4 years.