Question

Describe how the account balance of a savings account earning simple interest is determined.

Answer 1

Well, you can actually go to the bank and they'll help you determine your interest rate. Whether you get a fixed interest rate, which means that if you pick 7% interest for twenty years, then your interest rate won't go up or down. It will stay at 7%. Or you can let your bank pick your interest rate. But they'll most likely pick the lowest rate they can.