Don invests $12,000 into an account that pays 8.25% simple interest. How much interest does his account earn after 4 years?
1 answer:
Answer:
$3960
Step-by-step explanation:
Given parameters:
Principal = $12,000
Simple interest = 8.25%
Time = 4yrs
Unknown:
Interest earned = ?
Solution:
To solve this problem, we have to use the simple interest formula shown below:
Simple interest =
P is the principal
R is the rate
T is the time
Now insert the parameters and solve;
Simple interest = = $3960
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