Question

james deposits $12,500 into savings account that earns 4.5% annual simple interest. Assuming he doesn't make any additional deposits or withdrawals, how much interest should Jmaes expect to earn at the end of the year ?

Answer 1

James is expected to earn $562.5 at the end of the year as Interest.

Explanation:

Here, the amount deposited = Principal = $12,500

Rate of Interest = R = 4.5%

Time = T = 1 year

Now, to find the interest at the end of the year:

`\textrm{Simple Interest} = (P * R * T)/(100)`

or, S I =
`(12,500 * 4.5 * 1 )/(100)  = 562.5`

or, S I = $562.5

Hence, James is expected to earn $562.5 at the end of the year as Interest.