Question

Dilbert invested $18,000 in the first account with a 7% annual interest rate and $10,500 in the second account with a 3% annual interest rate. What is the total interest earned from both accounts after one year?

1) 1,785
2) 1,890
3) 2,175
4) 2,310

Answer 1

Neither of the given options is correct; the total interest earned from both accounts after one year is $1,575, which is calculated using the formula for simple interest.

Step-by-step explanation:

To calculate the total interest earned from both accounts after one year, we can use the formula for simple interest, which is Interest = Principal × Rate × Time. For the first account with a principal of $18,000 and an annual interest rate of 7%, the interest earned in one year is:

$18,000 × 0.07 × 1 = $1,260.

For the second account with a principal of $10,500 and an annual interest rate of 3%, the interest earned in one year is:

$10,500 × 0.03 × 1 = $315.

Adding both amounts of interest together gives us the total interest earned from both accounts:

$1,260 + $315 = $1,575

Therefore, none of the provided options (1,785; 1,890; 2,175; 2,310) are correct. The correct total interest earned from both accounts after one year is $1,575.