Question

Savings Account You have deposited $400 in a simple interest savings account, which pays three percent interest annually. Find the amount of interest for zero, 5, 10, 15, and 20 years. Add the interest to $400 and fill in the table. Round the amounts to the nearest dollar.# years05101520$ savingsUse the information from the table to graph a line to represent the simple interest account.

Answer 1

Given:

`\begin{gathered} P=\text{ \$400} \\ r=3\text{ \%} \end{gathered}`

Using the simple interest formula;

`I=\frac{\text{PTR}}{100}`

At t = 0 years,

`\begin{gathered} I=\frac{\text{PTR}}{100} \\ I=(400*0*3)/(100) \\ I=\text{ \$0} \end{gathered}`

At t = 5 years,

`\begin{gathered} I=\frac{\text{PTR}}{100} \\ I=(400*5*3)/(100) \\ I=\text{ \$60} \end{gathered}`

At t = 10 years,

`\begin{gathered} I=\frac{\text{PTR}}{100} \\ I=(400*10*3)/(100) \\ I=\text{ \$120} \end{gathered}`

At t = 15 years,

`\begin{gathered} I=\frac{\text{PTR}}{100} \\ I=(400*15*3)/(100) \\ I=\text{ \$180} \end{gathered}`

At t = 20 years,

`\begin{gathered} I=\frac{\text{PTR}}{100} \\ I=(400*20*3)/(100) \\ I=\text{ \$240} \end{gathered}`

To get the amount,

`\text{Amount}=\text{principal + interest}`
`\begin{gathered} At\text{ t = 0years,} \\ \text{Amount}=\text{principal + interest} \\ \text{Amount}=400+0=\text{ \$400} \\ \\ \\ At\text{ t = 5years,} \\ \text{Amount}=\text{principal + interest} \\ \text{Amount}=400+60=\text{ \$460} \\ \\ \\ At\text{ 10years,} \\ \text{Amount}=\text{principal + interest} \\ \text{Amount}=400+120=\text{ \$520} \\ \\ \\ At\text{ 15years,} \\ \text{Amount}=\text{principal + interest} \\ \text{Amount}=400+180=\text{ \$580} \\ \\ \\ At\text{ 20years,} \\ \text{Amount}=\text{principal + interest} \\ \text{Amount}=400+240=\text{ \$640} \end{gathered}`

The table can be represented below;

The graph to represent the simple interest account is shown below;