how do i evaluate a formula?

Question

How do I evaluate the formula I=Prt if P=$5000, r=5.5% and t=2 years?

Answer 1

Hi Lorna, This equation shows interest is equal to principal X rate X time. Therefore, Interest = $5,000 X 5.5%/year X 2 years = $550. This assumes simple interest with no compounding. Jim