Question

Find the simple interest earned in an account with $300 at 5% annual interest for 7 years.

A. $105.00
B. $420.00
C. $214.29
D. $11.67

Answer 1

Option A

The simple interest earned is $ 105

Solution:

Given that, $300 at 5% annual interest for 7 years

Therefore,

Principal = $ 300

Rate of interest = 5 %

Number of years = 7

The simple interest is given by formula:

`Simple\ Interest = (p * n * r )/(100)`

Where,

p is the principal

r is the rate of interest

n is the number of years

Substituting the values in formula,

`Simple\ Interest = (300 * 7 * 5 )/(100)\\\\Simple\ Interest = 3 * 7 * 5\\\\Simple\ Interest = 105`

Thus simple interest earned is $ 105