Question

Jeremiah currently has an account balance of $1624.35. His initial deposit on the account was $975 and it earned 3.7% simple interest. How long has Jeremiah held the account

Answer 1

Current Account Balance = $1,624.35

Initial Deposit = $975

Interest Rate (Simple) = 3.7% simple interest

Interest Earned = Current Account Balance - Initial Deposit

⇒ Interest Earned = $1,624.35 - $975

⇒ Interest Earned = $649.35

Now the Formula for Simple Interest is:

Simple Interest = ×$\frac{\text{P x R x T}}{100}$, where P is the initial deposit, R is the rate of interest and T is the time period

⇒ 649.35 = $\frac{\text{975 x 3.7 x T}}{100}$

⇒ T = $\frac{\text{649.35 x 100}}{\text{975 x 3.7}}$

⇒ T = 18

Hence, Jeremiah has had the account for 18 years.