Question

Jim invested $4,000 in a bond at a yearly rate of 4.5%. He earned $540 in interest. How long was the money invested?

a. 8 years
b. 9 years
c. 10 years
d. 11 years

Answer 1

Jim's money was invested for 3 years.

Step-by-step explanation:

To find the time period for Jim's investment, we can use the formula for simple interest:

Interest = Principal x Rate x Time

Given that Jim invested $4,000, earned $540 in interest, and the interest rate was 4.5%, we can solve for Time:

$540 = $4,000 x 0.045 x Time

Simplifying the equation, we get:

Time = $540 / ($4,000 x 0.045)

Calculating the value, we find that Time is approximately 3 years.

Therefore, the money was invested for 3 years.