Question

3. Chef Alfredo invested $4800 at a simple interest rate of 5% and can now afford a $6,000 state-of-the-art pizzaoven. How many years ago did he make this investment? Show all your work and answer in a complete sentence

Answer 1

Answer:

He made the investment 5 years ago.

$5\text{ years}$

Explanation:

Given that Chef Alfredo invested $4800 at a simple interest rate of 5%.

And the current value is $6,000.

$\begin{gathered} \text{ Principal P = \ 4,800} \\ \text{rate r =5\% = 0.05} \\ \text{future value = \ 6,000} \\ \text{ interest i = \ 6000-\ 4800= \ 1200} \end{gathered}$

Recall the formula for simple interest;

$\begin{gathered} i=P\times r\times t \\ t=\frac{i}{P\times r} \end{gathered}$

substituting the given values.

$\begin{gathered} t=\frac{1200}{4800\times0.05} \\ t=5\text{ years} \end{gathered}$

Therefore, he made the investment 5 years ago.

$5\text{ years}$