Question

You deposit $650 at a rate of 10% per year. How much simple interest will you earn after 2 years using the formula I = Prt?

A) $130
B) $65
C) $260
D) $325

Answer 1

Using the formula I = Prt, the simple interest earned after 2 years for a $650 deposit at a rate of 10% per year is $130.

Step-by-step explanation:

To calculate simple interest, use the formula I = Prt, where I represents the interest amount, P is the principal amount (the amount you deposited), r is the interest rate per year, and t is the time in years. In this case, the principal amount is $650, the interest rate is 10%, and the time is 2 years. Plugging these values into the formula, we get I = $650 imes 0.10 imes 2 = $130.