Question

To be able to go on a trip to South America, Yolanda decides to save for 6 years. She opens a savings account with $200 . The account pays simple interest at an annual rate of 2%. She doesn't make any more deposits. Answer the following questions. .

(a) How much total interest will Yolanda earn?
(b) What will the total amount in the account be (including interest)?

Answer 1

Yolanda will earn a total of $24 in interest over 6 years from her savings account with an initial deposit of $200 at an annual simple interest rate of 2%. The total amount in the account after 6 years, including interest, will be $224.

Step-by-step explanation:

To calculate the total interest Yolanda will earn on her $200 savings account at a simple interest rate of 2% over 6 years, we can use the formula for simple interest: I = PRT, where I is the interest, P is the principal amount, R is the rate of interest per year, and T is the time in years. Plugging in the values, we get:

I = $200 × 0.02 × 6 = $24

The total interest Yolanda will earn is $24.

To find out what the total amount in the account will be including interest, we simply add the interest earned to the initial amount deposited. Therefore:

Total amount = Principal + Interest = $200 + $24 = $224

The total amount in Yolanda's savings account after 6 years will be $224.