Question

You deposit $300 in an account that earns simple interest at an annual rate of 6.5%.

If no other deposits or withdrawals were made, what is the total amount of money in the account at the end of 8 years?
The total amount in the account is What?

Answer 1

To find the total amount of money in the account at the end of 8 years with simple interest , we can use the formula:

A = P * (1 + r * t

where A = total amount P = principal (initial amount) r = interest rate per year (as a decimal) t = time (in years)

In this case, P = $300 r = 6.5% = 0.065 t = 8 years

Substituting these values in the formula:

A = $300 * (1 + 0.065 * 8) A = $300 * 1.52 A = $456

Therefore, the total amount of money in the account at the end of 8 years is $456 with simple interest.

Note that this assumes that the interest is compounded annually , and that there are no other deposits or withdrawals made during the 8-year period. If the interest is compounded more frequently, or if there are additional deposits or withdrawals, the calculation would be different.