Which of the following statements about 585 are true? (Choose 2)
2 answers:
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It takes 4 years for a principal of $25,000 at a simple interest rate of 5% to become 30,000
<em><u>Solution:</u></em>
Given that:
principal = $ 25000
rate of interest = 5 %
Total amount = $ 30000
Number of years = ?
Formula used:
Total amount = principal + Simple interest
30000 = 25000 + Simple interest
Simple interest = 30000 - 25000
Simple Interest = $ 5000
<em><u>The simple interest is given as:</u></em>
Where, "p" is the principal
"n" is the number of years
"r" is the rate of interest
Substituting the values in formula, we get
Thus it takes 4 years for a principal of $25,000 at a simple interest rate of 5% to become 30,000