Question

Lets say you have $5,000 to invest. You decided to invest it in a bank account thatearns simple interest at 5% interest per year. How much will be in your account after 10years? (be sure to include cents. Example if you got $34 dollars as an answer you needto type in $34.00)

Answer 1

$7500.00

Step-by-step explanation:

The formula for simple interest is

`A=P(1+rt)`

where A is the final amount, P is the principal amount, r is the interest rate, and t is the time interval.

Now in our case, we have

P = $5000

r = 5% = 5/100

t = 10

Therefore the above formula gives

`A=5000(1+(5)/(100)\cdot10)`

the right-hand side simplifies to give

`A=\$7500`

which is our answer!

If we include the cents then we have

`A=\$7,500.00`