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You deposit $350 at 2.5% for 3 years. How much interest do you earn? Interest = Principle(Rate)(Time)

User Almira
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Final answer:

To calculate the interest earned on a $350 deposit at a 2.5% simple interest rate for 3 years, you use the simple interest formula: Interest = Principal × rate × time. Converting the rate to a decimal and multiplying by the principal and time, the total interest earned is $26.25.

Step-by-step explanation:

The question is asking how much interest is earned on a deposit of $350 made at a simple interest rate of 2.5% for a time period of 3 years. To calculate the interest earned, we can use the simple interest formula:

Interest = Principal × rate × time

First, the rate needs to be converted from a percentage to a decimal for the calculation, so 2.5% becomes 0.025. Then, we multiply the principal ($350) by the rate (0.025) and then by the time (3 years), which gives us:

Interest = $350 × 0.025 × 3 = $26.25

Therefore, the total interest earned after 3 years is $26.25.

User Lockszmith
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