Sylvia deposits $50 into a savings account with a 2% interest rate. Using the formula for simple interest, how much will she have in the account in 5 years?

Question

A
$55.00

B
$45.00

C
$60.00

D
$550.00

Answer 1

To calculate the amount Sylvia will have in her savings account after 5 years with a simple interest formula, we can use the formula:

$$A=P+I$$

where:

• $A$ is the total amount in the account after time $t$
• $P$ is the principal amount (initial deposit)
• $I$ is the interest earned

The interest $I$ can be calculated using the formula:

$$I=P\times r\times t$$

where:

• $r$ is the interest rate (as a decimal)
• $t$ is the time in years

Given:

• $P=50$
• $r=0.02$
• $t=5$

Now, we can calculate the interest:

$$I=50\times 0.02\times 5=50\times 0.1=5$$

Now, we can calculate the total amount in the account:

$$A=P+I=50+5=55$$

Thus, after 5 years, Sylvia will have $55.00 in her account.

The correct answer is A) $55.00.