Question

Jane invests £1,200 in a bank account which

earns interest at the rate of 6% per annum.
Find the value of a) the investment after 5
years

Answer 1

si = prt/100

i= 1200 * 6 * 5/ 100
= 360

Answer 2

£1560

Explanation:

First, converting R percent to r a decimal

r = R/100 = 6%/100 = 0.06 per year,

then, solving our equation

I = 1200 × 0.06 × 5 = 360

I = £ 360.00

The simple interest accumulated

on a principal of £ 1,200.00

at a rate of 6% per year

for 5 years is £ 360.00.