Question

Katie wants to know how much she needs to deposit into a two year CD account in order to earn $100 in simple interest. The account currently has a 1.5% interest rate. Round to the nearest cent . SHOW ALL WORK FOR ANY CREDIT!!

Answer 1

To obtain $ 100 in simple interest with a rate of 1.5%, Katie must deposit $ 6,666.66.

Explanation:

Given that Katie wants to know how much she needs to deposit into a two year CD account in order to earn $ 100 in simple interest, knowing that the account currently has a 1.5% interest rate, the following calculation must be performed:

X x 0.015 = 100

X = 100 / 0.015

X = 6,666.66

6,666.66 x 1.015 = 6,766.66

Thus, to obtain $ 100 in simple interest with a rate of 1.5%, Katie must deposit $ 6,666.66.