Question

$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?(1 point)

Answer 1

To calculate the interest earned during any one year with simple interest, we can use the formula:

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

where:
- \(I\) is the interest,
- \(P\) is the principal amount (the initial deposit),
- \(r\) is the annual interest rate (as a decimal),
- \(t\) is the time in years.

In this case:
- \(P = 40\) (the amount deposited),
- \(r = 10\% = 0.10\),
- \(t = 1\) (since we want to find the interest earned in one year).

Substituting these values into the formula:

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

Calculating this gives:

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

Therefore, the interest earned during any one of the years the money is deposited is **$4**.