Final answer:
To calculate the total amount in Fatuma's account at the end of one year, we use the simple interest formula, which yields an interest of $1,200. Adding the interest to the initial investment, the account's total value would be $13,200.
Step-by-step explanation:
Fatuma invests $12,000 at a 10% simple interest rate for 1 year. To calculate the total amount in the account at the end of the 1 year period, we would use the simple interest formula:
Simple Interest = Principal × Rate × Time
Plugging in the values we get:
Simple Interest = $12,000 × 0.10 × 1
Simple Interest = $1,200
The total amount in Fatuma's account at the end of the year would be the original principal plus the simple interest earned:
Total future amount = Principal + Simple Interest
Total future amount = $12,000 + $1,200
Total future amount = $13,200