Question

Stacy made a deposit of $8,500.00 into an account.
After ten years, the account had earned $5,525.00 in interest.
What simple interest rate did the account earn?
A. 2%
B. 4.5%
C. 5%
D. 6.5%
Explain c:

Answer 1

D

Answer 2

So I'm going to guess this is what they mean by simple interest.

The amount gained in interest, what percent of that is it of the total? That's just (5525/8500)*100 to get the percentage. That's 65%. However spread out over 10 years means you need to divide that by 10 to get 6.5%.

Answer 3

b/c $5525/$8500/10(ten years)=6.5%

Answer 4

Interest = Principle × Rate × Time.

Answer 5

(only if this is simple interest)

Answer 6

I hate this question, it is obviously wrong.

Answer 7

why?

Answer 8

With the answer 6.5% we can calculate the amount you have is 8500*.065. Now next year our amount will be (8500*.065)*.065 which is a totally different answer than (8500*.065)+(8500*.065) as is what we solved for in the answer, isn't it?

Answer 9

no, you're messed up with your logic.

Answer 10

This is simple interest.

And even if this were compound interest, it sill ain't calculated like this.

Answer 11

I guess I don't know what simple interest is, I've only ever looked at compound interest. Simple interest seems unrealistic if we're dividing our total interest by 10.

Answer 12

Simple interest is where the interest is calculated always on the original principle.