Question

Kira deposits 4,000 into an account that pays simple interest at a rate 5% per year how much interest will she be paid in the first 4 years

Answer 1

The formula to find the simple interest I for a deposit P with a simple interest annual rate of r during t years is:

$I=P\cdot t\cdot r$

In this problem, we have:

P = $4000

t = 4

r = 5% = 5/100

So, using those values in the formula, we obtain:

$I=\ 4000\cdot4\cdot\frac{5}{100}=\frac{\ 4000}{100}\cdot4\cdot5=\ 40\cdot20=\ 800$