Question

A trust fund yields a 6% simple interest dividend to its members' accounts every month. If a member has $5,000 in the fund's account, how much money would be in that account after 3 months?

A) $5,540
B) $5,900
C) $5,950
D) $6,000

Answer 1

To calculate the total amount of money in the account after 3 months with a 6% simple interest rate, use the formula Total amount = Principal + (Principal * Interest Rate * Time). Applying this formula, the correct answer is $5,900.

Step-by-step explanation:

To calculate the total amount of money in the account after 3 months with a 6% simple interest rate, we can use the formula:

Total amount = Principal + (Principal * Interest Rate * Time)

Applying this formula to the given values, we have:

Total amount = $5,000 + ($5,000 * 0.06 * 3) = $5,900

Therefore, the correct option is B) $5,900.