Final answer:
To calculate the simple interest for $52,700 at a 2% interest rate for 4 years, use the formula I = PRT. The calculation yields $4,216 in simple interest over the 4-year period.
Step-by-step explanation:
Calculating Simple Interest
To calculate the simple interest earned on $52,700 at a 2% interest rate for 4 years, the formula I = PRT can be used. Where 'I' is the interest, 'P' is the principal amount ($52,700), 'R' is the rate of interest per year (2% or 0.02), and 'T' is the time the money is invested or borrowed for, in years.
Using the given values:
- Principal (P) = $52,700
- Rate (R) = 2% or 0.02
- Time (T) = 4 years
The simple interest calculation would be as follows:
I = PRT
I = $52,700 × 0.02 × 4
I = $4,216
Therefore, the simple interest earned on the investment over 4 years is $4,216.