Question

WILL GIVE MEDAL AND FAN

Answer 1

Yvonne put $4,000 in a savings account. At the end of 3 years, the account had earned $960 in simple interest.

a. How much does she have in her account at the end of 3 years?
b. At what annual simple interest rate did the account grow? Show your work.
c. How many more dollars would she have in her account if the interest rate were 1% greater? Show your work.

Answer 2

a. well $4,000 (original amount) + $960 (interest) = $4,960 (current amount)

Answer 3

b. First, find how much she made per year by dividing the interest amount ($960) by 3. This should equal $320.

Answer 4

Next, divide 320 by 4,000 to find the percentage rate at which she earned per year, in decimal form. \[\frac{ 320 }{ 4,000 } = .08\] .08 interest per year

Answer 5

@annikaroo What is the rate?

Answer 6

Hold up, I think there is a specific kind of equation for this problem

Answer 7

So the equation for simple interest is \[I = Prt\] where I = interest ($960)
P = Principle amount ($4000)
r = yearly rate as a decimal (.08)
t = time in years (3)

Answer 8

So your answer for b would be .08

Answer 9

how did you get 8% or .08?

Answer 10

So 960 is the amount earned over 3 years, correct?

Answer 11

\[\frac{ 960 }{ 3 } = 320\] She made $320 per year

Answer 12

Following?

Answer 13

thanks BTW

Answer 14

no problem :)

Answer 15

to find the amount she invested each year, divide 320/4000 \[\frac{ 320 }{ 4000 } = .08\] A positive interest rate (like Yvonne's) needs 1 added to it. Because if the interest rate was less than one, the amount of money total in the accout would grow smaller and smaller. Therefore, the interest rate is 1.08.