Question

4,000 at 3% for 4 years

Answer 1

Problem

You deposit $4000 into a bank account paying 3% simple interest per year. You left the money in for 4 years. How much interest do you get at the end of those 4 years?

Result

The interest is $480.

Explanation

Find an interest by using the formula I=P⋅i⋅t, where I is interest, P is total principal, i is rate of interest per year, and t is total time in years.

In this examplee P = $4000, i = 3% and t = 4 years, so

III=P⋅i⋅t=4000⋅0.03⋅4=480