Question

Simple Interest

Remember the simple interest equation I=P.r.f where P represents principal balance, r represents
the interest rate as a decimal, and t represents time. If you need a refresher on using the simple interest
formula, click here!
Malik deposits $350 into a simple interest savings account that earns 2% per year. Saralah deposits $400
into a different simple interest savings account that earns 1% per year.
1. How much does Malik earn in interest in one year? Use the simple interest formula.
2. How much does Saralah earn in simple interest per year? Use the simple interest formula.
3. Write an equation for each account where x represents the number of years that have passed
and y represents total interest earned plus principal.
4. How long will it take for Malik and Saralah to have the same amount of money?

Answer 1

Malik earns $7 in interest in one year, Saralah earns $4 in interest per year. Malik's equation is y = 350 + 7x, Saralah's equation is y = 400 + 4x. It will take approximately 16.67 years for Malik and Saralah to have the same amount of money.

Step-by-step explanation:

1. To calculate the interest earned by Malik in one year, we can use the simple interest formula:

I = P * r * t

Where I is the interest, P is the principal balance, r is the interest rate, and t is the time in years. In this case, Malik's principal balance is $350 and the interest rate is 2%.

By substituting these values into the formula, we get:

I = $350 * 0.02 * 1 = $7

So Malik earns $7 in interest in one year.

2. For Saralah, her principal balance is $400 and the interest rate is 1%. Using the simple interest formula, we can calculate her interest earned in one year:

I = $400 * 0.01 * 1 = $4

Therefore, Saralah earns $4 in interest per year.

3. The equation for Malik's account would be y = 350 + 7x, where x is the number of years that have passed and y is the total interest earned plus principal. Similarly, the equation for Saralah's account would be y = 400 + 4x.

4. To find out how long it will take for Malik and Saralah to have the same amount of money, we can set their equations equal to each other and solve for x:

350 + 7x = 400 + 4x

3x = 50

x = 16.67

Therefore, it will take approximately 16.67 years for Malik and Saralah to have the same amount of money.