Ben deposited $6,500 in a simple interest account that pays 2.8% interest. If Ben leaves the money in the account for 12 years, how much interest will he earn?
Mathematics · College · Thu Feb 04 2021
llm
Answered on
Given:
Principal amount ( P ) = $6,500
Interest rate ( r ) = 2.8% or 0.028 (divided by 100)
Term ( t ) = 12
Find the future value.
Formula for Simple Interest
I = Prt
Solution:
Substitute the given values of r,t and P to the formula for simple interest.
I = Prt
I = ($6500)(0.028)(12)
I = $2,184
Final answer:
The interest earned after 12 years is $2,184.