Question

Felicia invests $25,000 in a savings account that pays 2.75% simple interest. How much interest does Felicia earn each year?

Answer 1

$687.50

Explanation:

Amount of interest Felicia earns each year

= 2.75% × $25000

= $687.50

Answer 2

Felicia earn $687.5 as interest.

Explanation:

We are given that Felicia invests $25,000 in a savings account that pays 2.75% simple interest.

Principal = $25000

Rate of interest = 2.75%

We are supposed to find interest does Felicia earn each year

Formula :
`SI = (P * T * R)/(100)`

Substitute the values in the formula

`SI = (25000 * 1 * 2.75)/(100)`

SI = 687.5

Hence Felicia earn $687.5 as interest.