Amount Invested by John in the savings account = $400
Rate of interest = 7%
Time period for which the money is kept = 5 years
Now the formula for calculating the amount of interest is
I = P * R* T
where
I = Interest Amount
P = Principal Amount
R = rate of Interest
T = Time for which the money is kept
Now we know all the details within the formula, and so calculating the interest amount is easy.
I = P * R * T
= 400 * (7/100) * 5
= 400 * .07 * 5
= 2000 * .07
= 140
So the amount of interest that John will gain after 5 years is $140.
