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2. Determine the total amount of an investment of $945, at 2.54% simple interest for three years.​

1 Answer

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Answer:

$1017.01

Explanation:

1. Since we know that it is simple interest for 3 years we can use the equation for simple interest which is A = P (1 + rt) where

A = final amount

P = initial balance

r = yearly interest rate

t = time (in years)

2. Input our numbers into this equation

A = 945(1 + 0.0254 x 3) (we converted our percentage into a decimal by dividing by a 100)

either using a calculator or working it out on paper we get the answer

$1017.009 or $1017.01 (2 d.p. as money only has 2 decimal places)

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