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liberstina [14]
4 years ago
9

Graduation is 3 years away and you want to have $1400 available for a trip. If your bank is offering a 3-year CD (certificate of

deposit) paying 3.3% simple interest, how much do you need to put in this CD to have the money for your trip?
Mathematics
1 answer:
Feliz [49]4 years ago
5 0

Answer: you need to put $1274 in this CD to have the money for your trip.

Step-by-step explanation:

The formula for determining simple interest is expressed as

I = PRT/100

Where

I represents interest paid on the CD.

P represents the principal or amount of money that you put in the CD

R represents interest rate that the CD is paying

T represents the duration of the investment in years.

From the information given,

R = 3.3%

T = 3 years

A = $1400

1400 = I + P

I = 1400 - P

Therefore,

1400 - P = (P × 3.3 × 3)/100

1400 - P = 0.099P

0.099P + P = 1400

1.099P = 1400

P = 1400/1.099

P = $1274

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