Question

II

Finding simple interest without a calculator
Lella deposits $600 into an account that pays simple interest at a rate of 2% per year. How much interest will she be paid in the first 3 years?

Answer 1

The Solution:

Given:

Lella deposited $600 into an account that pays 2% simple interest per year.

Required:

To find the interest Lella will get in the first 3 years.

To find the interest, we shall use the formula below:

`I=(PRT)/(100)`

In this case,

`\begin{gathered} P=\text{amount deposited=\$600} \\ T=\text{time in years =3 years} \\ R=\text{rate in percent=2\%} \\ I=\text{simple interest paid=?} \end{gathered}`

Substituting these values in the above formula, we get

`I=(600*2*3)/(100)=6*2*3=\text{ \$36}`

Thus, the interest she will be paid in 3 years is $36.00

Therefore, the correct answer is $36.00