Question

You deposit $650 in a savings account. How long does it take an account with an annual interest rate of 5% to earn $178.25 in interest? Round your answer to the nearest tenth.

Answer 1

about 5 years 6 months

Explanation:

First, converting R percent to r a decimal

r = R/100 = 5%/100 = 0.05 per year,

then, solving our equation

t = 178.25 / ( 650 × 0.05 ) = 5.4846

t = 5.4846 years

The time required to

accumulate simple interest of $ 178.25

from a principal of $ 650.00

at an interest rate of 5% per year

is 5.4846 years (about 5 years 6 months).