Yvonne put $4,00 in a savings account. At the end of three years, the account had earned $960 in simple interest.

1 answer:

7 0

Important variables to know:

I = interest
P = principal (investment)
R = simple interest rate
T = years

Formula: I = PRT

What information do we have?
I = $960
P = $4000
T = 3 years
R = ?

Plug into formula:

960 = 4000(3)(R)
960 = 12000R
R = 960/12000
R = .08

A. $4000 + $960 = $4960. (A= P+ I)
B. 8% (.08)

Part 2: 1080 = 4000*.09*3
A = 5080 - 4960 =$420.

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