Question

The amount of simple interest earned I, on an investment over a fixed amount of time ????, is jointly proportional to the principle invested P, and the interest rate ????. A principle investment of $1500.00 with an interest rate of 5% earned $375.00 in simple interest. Find the amount of simple interest earned if the principle is $2300.00 and the interest rate is 8%?

Answer 1

Answer:$920

Explanation:

Since the variation is joint, I=KPr where k is the constant of proportionality.

Plugging in the values of I=$375, P=$1500 and r=5% in the equation I=KPr, the value of k can be calculated. Hence, the formula connecting the three quantities (I,P and r) can be generated.

375 = K (1500×5)

Making k the subject of change,

K = 375/(1500×5)

K=1/20

Formula connecting the three quantities :I =Pr/20

when P=$2300, r=8%,

I = (2300×8)/20

I = $920