Lorraine invested $5,500 in a savings account with a yearly interest rate of 6% for 9 years. How much simple interest did she earn?

A. $330

B. $2,970

C. $297

D. $3,300

Hey!

the answer is B) $2,970, because:

(5500*6/100) * 9 = 2970$

The formula for simple interest is

F = P * (1 + n*i)

where F is the future worth of the money

P is the present worth

n is the numbe of years

i is the interest rate

substituting values, we get a future worth of $8470

The earnings is therefore $8470 - $5500 = $2970