Question

Compute the amount of interest earned in the following simple interest problem. A deposit of $5,000 at 8.5% for 120 days = _____.
$141.67
$1,416.67
$14,166,67
$51,000

Answer 1

I = Prt Always remember this. It si the essence fo Simple Interest.

We have P = 5000

I = (5000)rt

We ahve r = 0.085

I = (5000)(0.085)t

We have t = 120 days. This is a little bit of a problem. Different things use different numbers of days for a total year. Let;s just use 365 days for a full year.

I = (5000)(0.085)(120/365)

That's about it. Just one piece at a time!

Answer 2

Thank you so much!