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Keith_Richards [23]
3 years ago
6

Mark invested $500 in a cd that pays 5% simple interest, calcuated semiannually. How much money will mark earn in 3 years?

Chemistry
1 answer:
NeTakaya3 years ago
3 0

Answer: He will earn $75 after 3 years.

Explanation: To calculate Simple Interest, we use the formula:

i=\frac{PRt}{100}      .....(1)

where, i = Simple Interest

P = Principle amount

R = Rate of interest

t = Time period

Given:

P = $500

R = 5%

t = semiannually which means \frac{1}{2} years

As we are asked the total amount earned after 3 years which means 6 half years, so we multiply the interest calculated semiannually by 6 to get the total interest after 3 years.

Putting all the values in equation 1, we get

i=\left(\frac{500\times 5\times 1}{100\times 2}\right )\times 6

i = $75

Total amount earned after 3 years = i = $75

 = $75

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<u></u>

<u>Given:</u>

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