You put $3000 in a CD (certificate of deposit) at the promotional rate of 5.6% simple interest. How long will it take to earn $336 in interest?
Mathematics · Middle School · Mon Jan 18 2021
Answered on
Given:
Principal Amount ( P ) = $3000
Interest Rate ( r ) = 5.6% or 0.056 ( divided by 100)
Interest ( I ) = $336
Determine the time it would take to earn the interest.
Formula for Simple Interest:
I = Prt
t = I/Pr
t = term in year.
Solution:
Substitute the given values of P, r and I to the formula for t.
t = I / Pr
t = $336/($3000)(0.056)
t = $336/168
t = 2 years
Final answer:
2 years