Question

You are creating an emergency fund and decide to place $415.00/month in an account that earns a 3.75 APR. How much interest accrues by the end of the first full month?

Answer 1

At the end of the first full month the interest acquires is $ 1.30.

Explanation:

Since we are looking for the interest for full month, we have to divide the APR by 12.

Because APR is the interest amount for the full year.

So 3.75 % = 3.75/100 = 0.0375

Now multiplying, we will get

415 × 0.0375/12 = $ 1.30