Question

$5,000 at a simple annual interest rate of 6.5% for 5 years. What is the total amount of interest Ms. Lee must pay?

Answer 1

Answer:

$6625

General Formulas and Concepts:

Pre-Algebra

Order of Operations: BPEMDAS

1. Brackets
2. Parenthesis
3. Exponents
4. Multiplication
5. Division
6. Addition
7. Subtraction

• Left to Right

Algebra I

Simple Interest Rate Formula: A = P(1 + rt)

• P is principle amount
• r is rate
• t is time (in years)

Step-by-step explanation:

Step 1: Define

Identify variables

P = 5000

r = 6.5% = 0.065

t = 5

Step 2: Find Interest

1. Substitute in variables [Simple Interest Rate Formula]:                                 A = 5000(1 + 0.065 · 5)
2. (Parenthesis) Multiply:                                                                                      A = 5000(1 + 0.325)
3. (Parenthesis) Add:                                                                                             A = 5000(1.325)
4. Multiply:                                                                                                             A = 6625