Question

a bank pays simple interest at the rate of 5% per year for a certain deposit. if a customer deposits php 15, 000 and make no withdrawals for five years, what is the interest earned in that period of time?

Answer 1

To calculate the simple interest on a PHP 15,000 deposit at a 5% interest rate over five years, you use the formula I = P × r × t, resulting in an interest of PHP 3,750.

Step-by-step explanation:

The question revolves around calculating the simple interest earned on a PHP 15,000 deposit with a 5% annual interest rate over a period of five years.

Simple interest can be calculated using the formula:

I = P × r × t

where I is the interest earned, P is the principal amount (initial deposit), r is the annual interest rate (as a decimal), and t is the time the money is deposited in years.

Using the formula, we can determine the interest as follows:

I = PHP 15,000 × 0.05 × 5

I = PHP 3,750

Therefore, the interest earned after five years is PHP 3,750.