Question

Miss firkin put $100.00 in an interest earning savings account. she earned an interest rate of 1.25% and left that money in the bank for 10 years. How much simple interest did she earn over those 10 years.

Answer 1

To calculate simple interest, you can use the formula:

{Simple Interest} = P times R times T ]

where:

- \( P \) is the principal amount (the initial amount of money),

- \( R \) is the interest rate per period, and

- \( T \) is the time the money is invested or borrowed for, in years.

In this case:

- \( P = $100.00 \),

- \( R = 1.25\% \) or \( 0.0125 \) (converted to decimal form), and

- \( T = 10 \) years.

{Simple Interest} = 100 \times 0.0125 \times 10 \]

{Simple Interest} = $12.50 \]

So, Miss Firkin earned $12.50 in simple interest over the 10 years.

Answer 2

Miss Firkin earned simple interest totaling $12.50 over the course of 10 years on her $100.00 deposit in a savings account with an annual interest rate of 1.25%.

Step-by-step explanation:

To calculate the simple interest that Miss Firkin earned on her $100.00 deposit in a savings account at an interest rate of 1.25%, held for 10 years, we can use the formula for simple interest: I = PRT, where I is the interest, P is the principal amount deposited, R is the annual interest rate (in decimal form), and T is the time the money is invested in years.

Using the formula:

• Principal (P) = $100.00

• Interest Rate (R) = 1.25/100 = 0.0125 (converting the percentage to decimal form)

• Time (T) = 10 years

The simple interest is calculated as:

I = PRT = $100.00 × 0.0125 × 10 = $12.50

So, over the course of 10 years, Miss Firkin earned $12.50 in simple interest.