Question

Hank put $850 in an account for his daughter when she was born. When he withdrew the money 18 years later there was a total of $1,370.20 in an account. What was the simple interest rate.

Answer 1

To calculate the simple interest rate, we can use the formula:

Simple Interest = Principal x Rate x Time

Where "Principal" is the initial amount invested, "Rate" is the interest rate, and "Time" is the number of years.

We know that the principal (P) is $850, the final amount (A) is $1,370.20, and the time (T) is 18 years. We can rearrange the formula to solve for the rate (R):

R = (A/P - 1) / T

Plugging in the values, we get:

R = ($1,370.20/$850 - 1) / 18
R = 0.004235

Multiplying by 100 to convert to a percentage, we get:

R = 0.4235%

Therefore, the simple interest rate is 0.4235% per year.

Answer 2

so the formula is…
prt

so…

520.2 ( the amount of money made) =850*18*interest rate in decimal form
520.2 = 15300*interest rate in decimal form,
520.2/15300= interest rate
thus, this simplifies to
0.034.

transfer the decimal place two over for the percentage —> 3.4%