Question

F Maria earned $60 in interest over a 4-year period at a 4% simple annual interest rate, how much did she originally deposit in savings?

Option 1: $160
Option 2: $320
Option 3: $375
Option 4: $800

Answer 1

Using the formula for simple interest I = PRT,

Maria's original deposit was found to be $375 by solving the equation 60 = P × 0.04 × 4. This is consistent with the third option provided.

Step-by-step explanation:

To determine how much Maria originally deposited to earn $60 in interest over a 4-year period at a 4% simple annual interest rate, we can use the formula for simple interest: I = PRT, where I is interest, P is the principal amount (initial deposit), R is the rate of interest per year, and T is the time in years.

Maria earned $60 in interest (I), over 4 years (T) at a 4% interest rate (R = 0.04). Using the formula, we can set up the equation:

60 = P × 0.04 × 4

Solving for P, we get:

P = 60 / (0.04 × 4)

P = 60 / 0.16

P = $375

Maria's original deposit was $375.

This can also be confirmed by checking the options given:

• Option 1: $160
• Option 2: $320
• Option 3: $375
• Option 4: $800

Comparing the calculation result with the given options, it is clear that option 3 is the correct one.