Question

Dawn deposits $850.00 in an account that earns 6% simple interest. About how many years will it take for her account balance to earn $250.00 in interest?

Answer 1

Simple interest uses the formula

I = PRT

I = interest earned (250.00)
P = principal/original rate (850.00)
R = interest rate (.06)
T = time (in years) (what we want)

so...lets rearrange this equation for T since that is what we want

\[I = prt\]

Divide both sides by 'pr'...this will isolate 't' and allow us to solve for it

\[\frac{ I }{ pr } = \frac{ prt }{ pr }\]

This leaves us with

\[t = \frac{ I }{ pr }\]

So now input your values for I, P, R and solve for 't'...

Answer 2

would the answer be 5 years?

Answer 3

Since the question says "about how many years" yes the answer is 5 years...good job!!

Answer 4

Thank you I have another question could you help me.?

Answer 5

If I can sure...

Answer 6

Joe deposits $50,000.00 in an account that earns 8.3% simple interest. About how many years will it take for his account balance to earn $80,000.00 in interest?

Answer 7

So it's basically the same as what we just did....can you attempt it first and see if you can come to an answer?

Answer 8

I tried 50,00000 dived by 415000 and it made no sense to me

Answer 9

Remember when you simplify the formula it comes to

\[t = \frac{ I }{ pr }\]

I = 80000
P = 50000
R = .083

Answer 10

I have that correct, but I am stumped now

Answer 11

Why are you stumped?

Ahh I see what you did....remember that

the rate is 8.3% ....you don't multiply by this....you need to change this into a decimal

\[\frac{ 8.3 }{ 100 } = .083\]

What you did was multiply 50000 by 8.3...

but it should be 50000 by .083

Answer 12

Then I multiplied 50000.x 0.83 = 4150;

Answer 13

I'm assuming you meant .083...but yes that is correct....so now you have

\[t = \frac{ 80000 }{ 4150 }\]

so what is t...

Answer 14

There is my problem, I placed 50000. instead of the 80000.

Answer 15

Ahh....yes remember

I = 80000
and
P = 50000

so now you're all good....t = ?

Answer 16

answer is 19.years

Answer 17

That would be correct

Answer 18

Thank you so much , that was driving me crazy, You have a great 4th.

Answer 19

No problem! and you as well!!