Question

Find the total amount of interest earned on this savings account.

Time: 7 years

Interest Rate: 2.5%

Principal: $4,556

Interest:

$79.73
$797.30
$7,973
$79,730

Answer 1

To calculate the total amount of interest earned on a savings account, we can use the formula for simple interest:

\[ \text{Interest} = \text{Principal} \times \text{Rate} \times \text{Time} \]

Where:
- Principal = $4,556
- Rate = 2.5% = 0.025
- Time = 7 years

Now substituting these values into the formula:

\[
\text{Interest} = 4,556 \times 0.025 \times 7
\]

Calculating this step by step:

1. Calculate \( 4,556 \times 0.025 \):
\[
4,556 \times 0.025 = 113.9
\]

2. Now, multiply \( 113.9 \times 7 \):
\[
113.9 \times 7 = 797.3
\]

So, the total amount of interest earned on the savings account over 7 years is **$797.30**.

The correct answer from your options is **$797.30**.