To calculate the total amount in Yvonne's savings account at the end of 3 years, we need to add the original principal to the interest earned.
Total amount = principal + interest
Total amount = $4,000 + $960
Total amount = $4,960
To calculate the simple interest rate, we need to use the formula:
Interest = Principal x Rate x Time
We already know the values for Principal, Interest, and Time, so we can rearrange the formula to solve for Rate:
Rate = Interest / (Principal x Time)
Rate = $960 / ($4,000 x 3)
Rate = $960 / $12,000
Rate = 0.08 or 8%
So the account grew at an annual simple interest rate of 8%.
To calculate how much more Yvonne would have in her account if the interest rate were 1% greater, we can calculate the new interest earned using a rate of 9%. Then we subtract the original interest earned to find the difference:
New interest = $4,000 x 0.09 x 3 = $1,080
Difference = $1,080 - $960
Difference = $120
So Yvonne would have $120 more in her account if the interest rate were 1% greater.
Yvonne put $4,000 in a savings account. At the end of 3 years, the account had earned $960 in simple interest.
How much does she have in her account at the end of 3 years?
At what annual simple interest rate did the account grow? Show your work.
How many more dollars would she have in her account if the interest rate were 1% greater? Show your work.
1 answer