Question

A new bank customer with ​$3,000 wants to open a money market account. The bank is offering a simple interest rate of 1.3% How much interest will the customer earn in 30 years

Answer 1

We must use the simple interest formula which is: A = P(1+rt) where

A = output amount , P = initial amount, r = rate as a decimal, and t = time.

so in this case we would write:

A(30) = P(1+rt) = 3000(1 + 0.013(30)) = 4170

We then see that A(30) is equal to $4170 at 30 years.