Question

Marie invests $25,000 in a 60-day term deposit that pays four percent simple interest per year. How much money will she have after the 60-day period, to the nearest dollar?

Answer 1

`\$25,164`

Explanation:

we know that

The simple interest formula is equal to

`A=P(1+rt)`

where

A is the Final Investment Value

P is the Principal amount of money to be invested

r is the rate of interest

t is Number of Time Periods

in this problem we have

`t=60/365\ years\\ P=\$25,000\\r=4\%=4/100=0.04`

substitute in the formula above

`A=25,000(1+(60/365)(0.04))`

`A=\$25,164`