Question

Sally deposits $600 into a bank account. The bank pays a simple interest rate of 8% per year. What will Sally's balance be after one year?

Answer 1

To calculate Sally's balance after one year, we multiply her initial deposit by the interest rate and time, and add that to the initial deposit.

Step-by-step explanation:

To calculate Sally's balance after one year, we can use the formula for simple interest:

Simple interest = Principal * Rate * Time

where Principal is $600, Rate is 8% (or 0.08 as a decimal), and Time is 1 year.

Plugging in these values, we have:

Simple interest = $600 * 0.08 * 1 = $48

So, Sally's balance after one year will be her initial deposit plus the simple interest earned:

Sally's balance = $600 + $48 = $648