Question

Correct answers only!

To the nearest cent, how much interest will he earn in 2 years?

Use the formula B = p(1 + r)t, where B is the balance (final amount), p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years.

Answer 1

8.40

Explanation:

p= 40

r = 10% =0.10

t =2

plug in into B = p(1 + r)^t

B = 40(1 + 0.10)^2

B = 40(1.10)^2

B =48.40

make the difference between B, the balance (final amount) and p, the principal (starting amount) =48.40-40 =8.40