Question

Joey invest $900 at 4% simple interest for 2 years but he wants to know how much money he will have after only 18 months. Determine how much money he will have after 18 months.

Answer 1

Well, bearing in mind that, a year has 12 months, so 18 months is really just 18/12 of a year, or 3/2 a year, then

$\bf \qquad \textit{Simple Interest Earned Amount}\\\\ A=P(1+rt)\qquad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\to& \ 900\\ r=rate\to 4\%\to \frac{4}{100}\to &0.04\\ t=years\to \frac{18}{12}\to &\frac{3}{2} \end{cases} \\\\\\ A=900\left( 1+0.04\cdot \frac{3}{2} \right)$