Question

You invest $75.00 the first month and $1,000.00 the second month at 3.75% APR. How much interest do you accrue at the end of the second month?
(1 point)
Responses

$0.23
$0.23

$3.36
$3.36

$3.59
$3.59

$3.13

Answer 1

Monthly rate = 3.75% / 12 = 0.003125.

Interest = $75 × (2 months × 0.003125) + $1,000 × (1 month × 0.003125)
= $75 × 0.00625 + $1,000 × 0.003125
= $0.46875 + $3.125 = $3.59375 ≈ $3.59.

Answer: $3.59.