Question

Harper opened an account with a deposit of $2,500.

The account earned annual simple interest of 4%

She did not make any additional deposits or withdrawals.

When she closed the account, the balance of the account was $3,300.



How long was the account open?


9 years


8 years


5 years


6 years

Answer 1

The formula to calculate the total balance after a certain number of years with simple interest is:

Total Balance = Principal + (Principal * interest rate * number of years)

In this case, Harper's total balance was $3,300 and her initial deposit was $2,500. The interest rate was 4%. We need to find out the number of years.

So, the equation would be:

$3,300 = $2,500 + ($2,500 * 0.04 * number of years)

$800 = $100 * number of years

number of years = 8

Therefore, the account was open for 8 years.