Averyhas$100,000inasavingsaccountthatearns3.8%interestperyear.Theinterestisnotcompounded.Howmuchinterestwillsheearnin3years?

Use the formula i = prt, where i is the interest earned, p is the principal (starting amount), r is the interest rate expressed as a decimal, and t is the time in years.

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1 answer

To calculate the interest earned, we can use the formula \( i = prt \).

Where:

  • \( i \) = interest earned
  • \( p \) = principal (starting amount) = $100,000
  • \( r \) = interest rate (as a decimal) = 3.8% = 0.038
  • \( t \) = time in years = 3 years

Now, substituting the values into the formula:

\[ i = 100,000 \times 0.038 \times 3 \]

Calculating it step by step:

\[ i = 100,000 \times 0.038 = 3,800 \] \[ i = 3,800 \times 3 = 11,400 \]

Thus, the total interest earned in 3 years is:

\[ \boxed{11,400} \]