Question

Morgan has an investment worth $30,000 dollars invested at 5% simple interest. If no withdrawals or deposits were made, what is the balance after 20 years?

Answer 1

`\$60,000`

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=20\ years\\ P=\$30,000\\r=5\%=5/100=0.05`

substitute in the formula above

`A=30,000(1+0.05*20)`

`A=30,000(2)`

`A=\$60,000`