Question

Jose invested in a savings bond for 4 years and was paid simple interest at an annual rate of 5% . The total interest that he earned was 100 . How much did he invest?

Answer 1

Total He invested was 500

Explanation:

The formula for calculating simple interest is given by:

Interest = P x R x T

where:

P is the principal amount (initial investment),

r is the annual interest rate (as a decimal),

t is the time the money is invested or borrowed for (in years).

In this case, you know that the interest earned (Interest) is $100, the annual interest rate (r) is 5% or 0.05 (as a decimal), and the time (t) is 4 years.

Substitute these values into the formula:

100 = P x 0.05 x 4

Now, solve for P, the principal amount:

`P = (100)/(.02)`

P = 500

So, the total amount Jose Invested was 500.