Question

Sonia received a statement on her Certificate of Deposit showing that her investment had returned $4,320 over its life. If the Certificate of Deposit pays a simple interest rate of 4.8% and her initial investment was $12,000, how long had the money been invested?

Answer 1

The correct answer is -7.5 years.

Explanation:

Given:

Principle amount = 12000

Interest = 4320

time = ?

rate = 4.8 simple interest

Solution:

We know that simple Interest I = (P*t*r)/100

then t = I*100/p*r

putting values in formula:

t = 4320*100/4.8*12000

= 432000/57,600

= 7.5 years