Question

Sam earned $40 on his investment of $400. He earned 5% interest on his investment. How long did Sam leave his money in the bank?

Answer 1

Answer:

2yrs

Step-by-step explanation:

Given parameters:

Amount of interest earned  = $40

Principal  = $400

Interest rate  = 5%

Unknown:

Time taken for the money to be in bank = ?

Solution:

   The formula for interest is given as:

         I = $\frac{PRT}{100}$  

    Where I is the interest

              P is the principal

               R is the rate

               T is the time

    So;

    100I  = PRT

       T  = $\frac{100I }{PR}$   = $\frac{100 x 40}{400 x 5}$  = 2yrs