Question

a teacher invested $600 in an account that paid 2% annual simple interest the teacher did not maker any additional deposits or withdrawals. What is the total amount of interest paid by this investment at the end of 3 years?

Answer 1

$36.00

Explanation:

The formula for simple interest is I = P x r x t where P is the principal amount, $600.00, r is the interest rate, 2% per year, or in decimal form, 2/100=0.02, and t is the time involved, 3....year(s) time periods. So t is 3....year time periods. To find the simple interest, we multiply 600 × 0.02 × 3 to get that the interest is $36.00 . Usually now, the interest is added onto the principal to figure some new amount after 3 year(s), or 600.00 + 36.00 = 636.00.