Question

Jeremy's mother deposited $1,200 into a

savings account as a college fund when he
was born. How much will Jeremy have in
this account after 18 years at a yearly
simple interest rate of 4.25%?
A) $51.00
C) $918.00
B) $10,380.00
D) $2,118.00

Answer 1

Answer: D) $2,118.00

Explanation:

1 year = 4.25% interest rate

18 years = 76.5% interest rate

76.5% = 0.765

Take 1200 times 0.765 = $918.00

$918.00 is the interest money he will receive after 18 years. We have to add both numbers to find the total.

$1,200 + $918.00 = $2118.00