Question

3. Jim invests $3500, compounded annually at 12% for 3 years. What is the total

amount Jim will earn after 3 years?

A) 18,725.88
B)15,225.88
C) 19,157.48
D) 18,225.88

Answer 1

None of the above, it should be $4760

Explanation:

First, converting R percent to r a decimal

r = R/100 = 12%/100 = 0.12 per year,

then, solving our equation

I = 3500 × 0.12 × 3 = 1260

I = $ 1,260.00

The simple interest accumulated

on a principal of $ 3,500.00

at a rate of 12% per year

for 3 years is $ 1,260.00