Question

Bonnie deposits $250 into a new savings account. The account earns 3.5% simple interest per year No money is added or removed from the savings account for 6 years. What is the total amount of money in her savings account at the end of the 6 years?

Answer 1

Let's begin by identifying key information given to us:

Principal (p) = $250

Interest rate (r) = 3.5% = 3.5/100 = 0.035

Time (t) = 6 years

The simple interest is given by:

`\begin{gathered} A=p(1+rt) \\ A=250(1+0.035\cdot6) \\ A=259(1+0.21) \\ A=250(1.21) \\ A=\text{\$}302.50 \end{gathered}`