If $400 is placed in a savings account that earns a yearly 3.5% interest, how much will there be after 10 years?
Mathematics · Middle School · Thu Feb 04 2021
Answered on
Given:
Principal amount ( P ) = $400
Interest rate ( r ) = 3.5% or 0.035 (divided by 100)
Term ( t ) = 10
Find the future value.
Formula for Simple Interest
A = P ( 1 + rt )
Solution:
Substitute the given values of r,t and P to the formula for simple interest.
A = P ( 1 + rt )
A = $400 ( 1 + (0.035)(10))
A = $400 ( 1 + 0.35)
A = $400 ( 1.35)
A = $540
Final answer:
The future value of the investment is $540.