Question

invests $8,000 in a savings plan that pays 5% per year. What will the account balance be at the end of the first year?

Answer 1

The equation is I = PRT where I is the interest to, P is the principal, or money deposited, R is the rate in decimal form, and T is time in years.

I = (8,000)(0.05)(1)
I = $400

Add that to the original deposit and you have $8,400 as the account balance at the end of the first year