Question

Dan invests £18790 into his bank account. He receives 5.9% per year simple interest. How

much will Dan have after 2 years? Give your answer to the nearest penny where appropriate.

Answer 1

Answer: £21007.22

Explanation:

First, find the interest amount using the formula SI = (P × R × T) / 100.

• SI = interest amount
• P = principle amount = £18790
• R = interest rate(in percentage) = 5.9
• T = time(in years) = 2

SI = (P × R × T) / 100 = (18790 × 5.9 × 2)/100 = 221722/100 = £2217.22

The total amount = principle amount + interest amount

= £18790 + £2217.22 = £21007.22