Question

Isabella deposited $500 into a savings account at a local bank that earned 5 1/2% intrest per year. How much intrest dose she earn per year?

Answer 1

Answer:

$27.50

Step-by-step explanation:

The amount of interest she will earn in a year is basically the initial amount multiplied by the rate of interest per year (in decimal).

We have to first convert 5  1/2%  to decimal.

First,

1/2 means 0.5 (by dividing), so it becomes:

5.5%

Converting percentage to decimal is easy. We divide by 100, so we have:

5.5/100 = 0.055

Now we multiply:

500 * 0.055 = $27.5

So, in 1 year, Isabella earns an interest of $27.50