Question

A bank is offering 2.5% simple interest on a savings account. If you deposit $5000, how much interest will you earn in 4 years?

50,000

$12,500

$125

$500

Answer 1

Answer: $125 interest

Answer 2

Answer: $125 interest

Explanation:

2.5/100=0.025 r=0.025

time 1 year t=1

p=5000 r=0.025 t=1

I=P*R*T

I=5000*0.025*1

I=125