Question

An account earns simple annual interest.

$5200 at 7.36% for 54 months

a. Find the interest earned.

$

b. Find the balance of the account.

$

Answer 1

Interest earned =$1722.24

New Balance of account = $6922.24

Explanation:

An account earns simple interest.

$5200 at 7.36% for 54 months.

The principal account (P) = $5200

R = 7.36%

T = 54 months = 54/12 year = 4.5 year.

The simple interest is calculated as:

I = P × R × T/100

I = 5200 × 7.36% × 4.5/100

I = $ 1722.24

The interest earned = $1722.24

The new balance of the account is:

P + I

= 5200 + 1722.24

= $6922.24.

The new balance of account = $6922.24