To calculate how much Trevor will have in her savings account after 5 years with a simple interest rate of 12% per year, we can use the formula for simple interest:
\[ A = P + (P \times r \times t) \]
Where:
- \( A \) is the total amount of money after interest
- \( P \) is the principal amount (initial investment)
- \( r \) is the interest rate (as a decimal)
- \( t \) is the time in years
Given:
- \( P = 99,718 \)
- \( r = 12% = 0.12 \)
- \( t = 5 \)
First, calculate the interest earned over 5 years:
\[ \text{Interest} = P \times r \times t = 99,718 \times 0.12 \times 5 \]
Now calculate that step-by-step:
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Calculate \( 0.12 \times 5 \): \[ 0.12 \times 5 = 0.6 \]
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Then calculate the interest: \[ \text{Interest} = 99,718 \times 0.6 = 59,830.8 \]
Now, add the interest to the principal to find the total amount:
\[ A = P + \text{Interest} = 99,718 + 59,830.8 = 159,548.8 \]
Finally, rounding to the nearest cent:
\[ A \approx 159,548.80 \]
So, Trevor will have approximately $159,548.80 in total after 5 years.
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