Question

Sascha deposited $600 in a simple interest saving account. In one year the value of the account increased to $621

Answer 1

To find the interest rate, use the simple interest formula. Then, use the formula again to calculate the interest amount.

Step-by-step explanation:

Solving for the interest rate:

To find the interest rate, we can use the simple interest formula: I = PRT. We know the initial deposit (P) is $600, the time (T) is 1 year, and the total value (I + P) is $621. Plugging these values into the formula gives us $21 = $600 * R * 1. Dividing both sides by $600 gives us R = 0.035, or 3.5%.

Calculating the interest:

Now that we have the interest rate, we can use the simple interest formula to find the interest amount. Plugging in P = $600, R = 0.035, and T = 1, we get I = $600 * 0.035 * 1 = $21. So, the interest earned in one year is $21.