Question

Wanda placed $100 in a savings account that pays 2% simple interest per year. After 6 months Wanda made another deposit of $100. How much money will be in her account at the end of one year​

Answer 1

Answer:

$\ 203.01$

Step-by-step explanation:

we know that

The simple interest formula is equal to

$A=P(1+rt)$

where

A is the Final Investment Value

P is the Principal amount of money to be invested

r is the rate of interest  

t is Number of Time Periods

in this problem we have

After 6 months

$t=6/12=0.5\ years\\ P=\ 100\\r=2\%=2/100=0.02$

substitute in the formula above

$A_1=100(1+0.02*0.5)$

$A_1=100(1.01)$

$A_1=\ 101$

At the end of one year

$t=6/12=0.5\ years\\ P=A_1+\ 100=\ 101+\ 100=\ 201\\r=2\%=2/100=0.02$

substitute in the formula above

$A_2=201(1+0.02*0.5)$

$A_2=201(1.01)$

$A_2=\ 203.01$