Question

If $3,840 is invested in an account at 5% annual simple interest, how long will it take the account balance to grow to $4,800 ?

a. 12 years
b. 6 years
c. 5 years
d. 8 years

Answer 1

It will take 8 years for the account balance to grow to $4,800.

Step-by-step explanation:

To find the time it takes for the account balance to grow to $4,800, we can use the formula for simple interest:

Simple Interest = Principal × Rate × Time

In this case, the principal is $3,840, the rate is 5%, and the account balance is $4,800. We can set up the equation:

$4,800 = $3,840 × 0.05 × Time

Simplifying the equation, we get:

Time = $4,800 / ($3,840 × 0.05)

Time = 8 years