To calculate the interest earned on an investment or loan of $21,400 for a period of 3.5 years at an interest rate of 3.5% per annum, we can use the formula for simple interest:
\[ \text{Interest} = P \times r \times t \]
where:
- \( P \) is the principal amount (the initial amount of money),
- \( r \) is the annual interest rate (in decimal),
- \( t \) is the time in years.
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Convert the interest rate from a percentage to a decimal: \[ r = \frac{3.5}{100} = 0.035 \]
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Identify the principal and time: \[ P = 21,400, \quad t = 3.5 \]
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Plug the values into the formula: \[ \text{Interest} = 21,400 \times 0.035 \times 3.5 \]
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Calculate the interest: \[ \text{Interest} = 21,400 \times 0.035 = 749 \] \[ \text{Interest} = 749 \times 3.5 = 2,621.5 \]
So, the total interest earned after 3.5 years would be $2,621.50.
If you would like to find the total amount after 3.5 years, you would add this interest to the principal:
\[ \text{Total Amount} = P + \text{Interest} = 21,400 + 2,621.5 = 24,021.50 \]
Thus, the total amount after 3.5 years would be $24,021.50.