Question

Select the correct answer. simple interest = p × r × t if the principal is $200 and the interest rate is 4 percent, what is the simple interest earned in one year?

a. $8
b. $50
c. $800

Answer 1

The simple interest earned on a $200 principal at a 4% interest rate for one year is $8. This is calculated using the formula Simple Interest = Principal × Rate × Time.

Step-by-step explanation:

To calculate simple interest, you can use the formula: Simple Interest = Principal × Rate × Time. Let's apply the formula to the given information:

• Principal (P) = $200
• Interest Rate (R) = 4% or 0.04 in decimal form
• Time (T) = 1 year

Plugging the values into the formula, we get:

Simple Interest = $200 × 0.04 × 1 = $8

Therefore, the simple interest earned in one year on a principal of $200 at an interest rate of 4% is $8.