Final Answer:
You would need to invest for approximately 1.75 years to earn $42 in interest on a $2500 investment at an interest rate of 2.80%.
Step-by-step explanation:
To calculate the time needed to earn a specific amount of interest, you can use the formula: Interest = Principal × Rate × Time. In this case, the interest is $42, the principal amount is $2500, and the interest rate is 2.80%. Rearranging the formula to solve for time, we get Time = Interest / (Principal × Rate). Plugging in the values, Time = $42 / ($2500 × 0.028) = 1.75 years.
This calculation assumes that the interest is compounded annually. The formula uses simple interest, so the time calculated represents the duration needed to earn the specified interest amount with a constant interest rate.
Factors like compounding frequency (whether the interest is compounded annually, quarterly, monthly, etc.) can influence the actual time needed to reach the target interest. The formula used here assumes simple interest, where the interest is calculated only on the initial principal amount throughout the investment period.