Question

Therese invested her $200 West Virginia lottery winnings in a 6-month certificate of deposit (cd) that earns 3% simple interest per annum. Find the amount of interest Therese's investment will earn.

Answer 1

well, simple interest, earns the same amount every year, as opposed to compund interest.... so let's see how much Therese gets in say 1year then


`\bf \qquad \textit{Simple Interest Earned}\\\\ I = Prt\qquad \begin{cases} I=\textit{interest earned}\\ P=\textit{original amount deposited}\to& \$200\\ r=rate\to 3\%\to (3)/(100)\to &0.03\\ t=years\to &1 \end{cases}`