Final answer:
To find the total amount in the account after 18 months with 3.75% simple interest, multiply the principal ($4,250) by the interest rate (0.0375) and the time (1.5 years). Then add the interest earned to the principal to find the total amount in the account.
Step-by-step explanation:
To calculate the amount of money in the account after 18 months, we need to use the formula for simple interest:
I = P * r * t
Where:
- I is the interest earned
- P is the principal (initial deposit)
- r is the interest rate (as a decimal)
- t is the time in years
In this case, the principal is $4,250, the interest rate is 3.75% (or 0.0375 as a decimal), and the time is 18 months (or 1.5 years).
So the calculation is:
I = $4,250 * 0.0375 * 1.5 = $239.06
The interest earned is $239.06, so to find the total amount in the account, we add the interest to the principal:
Total amount = $4,250 + $239.06 = $4,489.06