$40 is deposited into a credit union that offers a 10% simple interest rate per year for 15 years. How much interest will be earned during any one of the years the money is deposited

Answer 1

To calculate the simple interest earned in one year, you can use the formula for simple interest:

\[ I = P \times r \times t \]

where:

• \( I \) is the interest,
• \( P \) is the principal (the initial amount deposited),
• \( r \) is the annual interest rate (expressed as a decimal),
• \( t \) is the time in years.

In this case:

• \( P = 40 \) (the initial amount deposited),
• \( r = 0.10 \) (10% expressed as a decimal),
• \( t = 1 \) (for one year).

Now we can substitute these values into the formula:

\[ I = 40 \times 0.10 \times 1 \]

Calculating this gives:

\[ I = 40 \times 0.10 = 4 \]

So, the interest earned during any one of the years the money is deposited is \($4\).

Answer 2

You make a one-time deposit of $200 earned at your pizzeria job into a bank that pays simple interest. After 5 years, you check your balance and you have $230. How much did you earn in interest each year? Do not include a dollar sign in your answer. Round to the nearest cent (hundredth).

Answer 3

To find out how much interest you earned each year, we first need to determine the total interest earned over the 5 years.

1. Calculate the total interest earned: The total balance after 5 years is $230, and the initial deposit was $200. Thus, the total interest earned over 5 years is:

   \[ \text{Total Interest} = \text{Final Amount} - \text{Initial Deposit} = 230 - 200 = 30 \]

2. Calculate the annual interest: Since this is simple interest, the total interest earned is evenly distributed over the number of years. To find the annual interest, divide the total interest by the number of years:

   \[ \text{Annual Interest} = \frac{\text{Total Interest}}{\text{Number of Years}} = \frac{30}{5} = 6 \]

Thus, you earned 6.00 in interest each year.

Answer 4

$1000 is invested at 8% interest compounded annually. $80 in interest is earned in the first year. Knowing that compound interest grows exponentially, how much interest is earned in the second year? Include dollars and cents in your answer.

Answer 5

To calculate the interest earned in the second year on an investment of $1000 at an 8% interest rate compounded annually, we first confirm the interest calculation for the first year and then apply the compound interest formula for the second year.

1. Calculate the interest for the first year: The interest earned in the first year can be calculated as:

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

   where:

   • \( P = 1000 \) (the principal),
   • \( r = 0.08 \) (the interest rate as a decimal).

   So,

   \[ \text{Interest} = 1000 \times 0.08 = 80 \]

2. Calculate the new principal after the first year: After the first year, the new principal (the amount for the second year's interest calculation) is:

   \[ \text{New Principal} = \text{Initial Investment} + \text{Interest Earned} = 1000 + 80 = 1080 \]

3. Calculate the interest for the second year: Now we can calculate the interest earned in the second year using the new principal:

   \[ \text{Interest for the Second Year} = \text{New Principal} \times r = 1080 \times 0.08 \]

   Calculate this:

   \[ \text{Interest for the Second Year} = 1080 \times 0.08 = 86.4 \]

Thus, the interest earned in the second year is $86.40.

Answer 6

A family purchases a camping RV for $24,000. They borrow the money from a credit union at an 11% simple interest rate for 4 years. How much in interest will the family pay in total? Round to the nearest whole dollar.

Answer 7

To calculate the total interest paid on the loan for the camping RV, we can use the formula for simple interest:

\[ I = P \times r \times t \]

where:

• \( I \) is the interest,
• \( P \) is the principal (the amount borrowed),
• \( r \) is the annual interest rate (expressed as a decimal),
• \( t \) is the time in years.

In this case:

• \( P = 24,000 \) (the amount borrowed),
• \( r = 0.11 \) (11% expressed as a decimal),
• \( t = 4 \) (the duration of the loan in years).

Now, substituting these values into the formula gives:

\[ I = 24000 \times 0.11 \times 4 \]

Calculating this step by step:

1. Calculate \( 24000 \times 0.11 \):

   \[ 24000 \times 0.11 = 2640 \]

2. Then multiply by 4:

   \[ I = 2640 \times 4 = 10560 \]

So, the total interest the family will pay over the 4 years is $10,560.

Answer 8

You are saving money for a down payment on a motor scooter. You deposit $1,500 in a savings account that pays 5% interest compounded annually. How much will you have saved after 6 years? Round to the nearest dollar

Answer 9

To calculate the total amount saved after 6 years with an initial deposit of $1,500 in a savings account that pays 5% interest compounded annually, you can use the compound interest formula:

\[ A = P \left(1 + r\right)^t \]

where:

• \( A \) is the amount of money accumulated after \( t \) years, including interest,
• \( P \) is the principal amount (the initial deposit),
• \( r \) is the annual interest rate (in decimal form),
• \( t \) is the number of years the money is invested or borrowed.

Given:

• \( P = 1500 \),
• \( r = 0.05 \),
• \( t = 6 \).

Now substitute these values into the formula:

\[ A = 1500 \left(1 + 0.05\right)^6 \]

First, calculate \( 1 + 0.05 \):

\[ 1 + 0.05 = 1.05 \]

Now raise \( 1.05 \) to the power of \( 6 \):

\[ 1.05^6 \approx 1.340095 \]

Next, multiply this by the principal amount:

\[ A = 1500 \times 1.340095 \approx 2010.14 \]

Rounding to the nearest dollar, the amount saved after 6 years is approximately:

\[ \boxed{2010} \]

Thus, you will have saved $2,010 after 6 years.

Answer 10

You deposited $350 in the bank with simple interest several years ago. You are keeping track of your account balance by drawing a graph. The points (3,21)
and (8,56)
are on the graph. What is the amount of interest you earn each year?(1 point)
Responses

$2.67
$2.67

$77.00
$77.00

$7.00
$7.00

$35.00

Answer 11

To find the amount of interest earned each year, you can use the two given points on the graph: (3, 21) and (8, 56).

Step 1: Determine the change in interest and time.

• The first point (3, 21) indicates that after 3 years, the total amount in the account is $21.
• The second point (8, 56) indicates that after 8 years, the total amount in the account is $56.

Step 2: Calculate the change in amount and time:

• Change in total amount = 56 - 21 = 35.
• Change in time = 8 - 3 = 5 years.

Step 3: Calculate the interest earned per year:

You can find the interest per year by dividing the change in total amount by the change in time:

\[ \text{Interest per year} = \frac{\text{Change in total amount}}{\text{Change in time}} = \frac{35}{5} = 7 \]

Thus, the amount of interest earned each year is $7.00.

Final Answer: \[ \boxed{7.00} \]