Question

$20,000 is deposited into an account at an APR of 8%. What will be the new account balance after 9 months?

Answer 1

STEP - BY - STEP EXPLANATION

What to find?

The new the new account balance after 9 months.

Given:

Principal (p) = $20 000

Rate(R) = 8

Time(t) = 9 months = 9/12 year = 0.75 years.

We will solve the given problem using the steps below:

Step 1

State the formula that will be use to solve the problem.

`I=(P* R* T)/(100)`

Where I is the interest.

Step 2

Substitute the values into the formula.

`I=(20000*8*0.75)/(100)`
`=(120000)/(100)`
`=1200`

Hence, interest(I) = $1200

But;

Amount = principal + Interest

= 20 000 + 1200

=21200

Therefore, the account balance after 9 months is $21200

ANSWER

$21200