Question

Suppose you deposit ​$600 in a bank account with a simple interest rate of 2.5​%. You want to keep your deposit in the bank long enough to earn at least ​$120 in interest. How long should you keep your deposit in the​ bank? To earn at least ​$120 ​interest, you should keep your deposit in the bank for blank ​years

Answer 1

It will take 8 years to earn $120 interest.

Explanation:

Giving the following information:

Principal= $600

Interest= $120

Interest rate= 2.5% = 0.025

To calculate the time required to reach the objective, we need to use the following formula:

I= P*r*t

I= interest

P= principal

r= rate

t= time

We isolate t:

t= I / (P*r)

t= 120 / (600*0.025)

t= 8

It will take 8 years to earn $120 interest.