Question

Ignacio earns 5 percent simple interest annually on his savings account. How much interest will he earn each month on $1250?. .

Answer 1

Find the interest earned in 1 year and divide it by 12 (number of months per year)

simple interest=principal times rate times time

so we have 1250 principal (amount invested)
rate is 5% or 0.05
time is 1 year

in 1 year, he earns 1250 times 0.05 times 1 or $62.5 per year
divide by 12
62.5/12=5.2083333333333333333333333333333
earns about $5.21 per month in interest

Answer 2

5% simple interest annually means an interest rate of (5% / 12) monhtly. . Then, the monthly interest is $ 1250 * 5% / 12 = $ 1250 * 0.05 / 12 = $ 5,21. Answer: he will earn an interest of $ 5.21 each month.