Question

You have 2 different savings accounts. For Account A, the simple interest earned after 18 months is $7.20. For Account B, the simple interest earned after 33 months is $41.25. If the interest rate is 3.2% for Account A and 2.5% for Account B, how much is the principal in each account?

A. For Account A, the principal is $300, and for Account B, the principal is $1650.
B. For Account A, the principal is $225, and for Account B, the principal is $1650.
C. For Account A, the principal is $300, and for Account B, the principal is $3300.
D. For Account A, the principal is $225, and for Account B, the principal is $3300.

Answer 1

The principal in Account A is $150 and the principal in Account B is $1500.

Step-by-step explanation:

To find the principal in each account, we can use the formula for simple interest:

Simple Interest = Principal × Rate × Time

For Account A:

7.20 = P × 0.032 × 1.5

Dividing both sides of the equation by 0.032 × 1.5 gives us:

P = 7.20 ÷ (0.032 × 1.5) = 150

So the principal in Account A is $150.

For Account B:

41.25 = P × 0.025 × 2.75

Dividing both sides of the equation by 0.025 × 2.75 gives us:

P = 41.25 ÷ (0.025 × 2.75) = 1500

So the principal in Account B is $1500.