Question

what is the simple interest on 5,000 naira for 4 months at 1 1/2 percent per annum

Answer 1

To calculate simple interest, you can use the formula:

\[
\text{Simple Interest} = P \times r \times t
\]

where:
- \( P \) is the principal amount (the initial amount of money),
- \( r \) is the annual interest rate (in decimal),
- \( t \) is the time the money is invested or borrowed in years.

For your case:
- \( P = 5,000 \) naira,
- \( r = 1.5\% = \frac{1.5}{100} = 0.015 \),
- \( t = \frac{4 \text{ months}}{12 \text{ months/year}} = \frac{1}{3} \text{ years} \).

Now, plug these values into the formula:

\[
\text{Simple Interest} = 5,000 \times 0.015 \times \frac{1}{3}
\]

Calculating this step-by-step:

1. Calculate \( 5,000 \times 0.015 \):
\[
5,000 \times 0.015 = 75
\]

2. Then multiply by \( \frac{1}{3} \):
\[
75 \times \frac{1}{3} = 25
\]

Therefore, the simple interest on 5,000 naira for 4 months at an annual interest rate of 1.5% is **25 naira**.