Julio invested $2,000 in a simple interest account for 3 years. She has earned $150 interested by the end. What was the simple interest rate of the account?

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Mathematics

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28 December, 04:56

Julio invested $2,000 in a simple interest account for 3 years. She has earned $150 interested by the end. What was the simple interest rate of the account?

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Giancarlo Vaughan · Answer 1

Answer: $2,150.00 = 2.5%

(I = A - P = $150.00)

Equation:

A = P (1 + rt)

Calculation:

First, converting R percent to r a decimal

r = R/100 = 2.5%/100 = 0.025 per year.

Solving our equation:

A = 2000 (1 + (0.025 * 3)) = 2150

A = $2,150.00

The total amount accrued, principal plus interest, from simple interest on a principal of $2,000.00 at a rate of 2.5% per year for 3 years is $2,150.00.