Answer:
Bank One is offering a simple interest rate of 6.25% per annum.
Step-by-step explanation:
Given that Bank One offers a certificate of deposit that pays $ 5,000 in four years for exchange for $ 4,000 today, to determine what interest rate is Bank One offering the following calculation must be performed:
(5000 - 4000) / 4 = X
1000/4 = X
250 = X
4000 = 100
250 = X
250 x 100/4000 = X
25000/4000 = X
6.25 = X
Therefore, Bank One is offering a simple interest rate of 6.25% per annum.
So, we'll find out how much interest this person will have in 6 years and then add it to the original deposit. To do this we will multiply all the factors:
500 x 0.04 x 6 = 120.
This means they'll have made $120 in interest in 6 years if they don't touch the money. We will add the 120 to the 500.
500+120= 620
They will have a total of $620 in their account after 6 years.
Explanation: This is a linear equation because it's written in slope-intercept form or <em>y = mx + b</em> where the multiplier or the coefficient of the x-term represents the slope of the line and the<em> b</em> represents the constant term.
So the slope will be the coefficient of the <em>x-term</em> which means the number that is in front of the <em>x</em> which in this case is -5/4.
The y-intercept is the constant term which is +8
