Question

Alisa is investing $6,250 to get ready for college expenses. Her bank offers an annual rate of 6.12% per year and she plans to do this for 4 years. How much will she have saved after 4 years?​

Answer 1

Money Alisa is investing each year = $6250

Number of years for which Alisa will be investing = 4

Annual interest rate for the investment = 6.12

We know that :

$\color{hotpink}\tt \: simple \: interest \: \color{plum}= \frac{principal \times rate \times time}{100}$

In this case :

Principal = $6,250

Rate = 6.12%

Time = 4 years

$\hookrightarrow \:$Principal + interest = Amount = Money Alisa would have saved at the end of 4 years

Money Alisa would have saved at the end of 4 years :

$=\tt25000 + \frac{25000 \times 6.12 \times 4}{100}$

$=\tt 25000 + \frac{612000}{100}$

$= \tt25000 + 6120$

$\color{plum}= \tt\ 31120$

Therefore, money Alisa would have saved after 4 years = $31,120