Kendra has $1200 in her savings account. She receives 1.75% annual simple interest. If she makes no further deposits or withdrawals, how much money will she have in the account after 2 years?

Answer 1

Hello, thank you for taking the time to post your question!

The formula that you want to use here for simple interest is that

I = P x r x t, where

P = principal = 1200

r = annual interest rate = 1.75%

t = time = 2 years

so the Interest earned over the 2 years would be

I = 1200 x 1.75% x 2 = 42

The question then is after the final amount at the end of the two years, so that comes from adding the beginning balance + interest

1200 + 42 = 1242

So after the 2 years have passed, Kendra will have $1242 in her account

I hope that helps get you moving in the right direction! Feel free to reach out if you have any additional questions beyond that :)

Answer 2

Simple Interest is calculated using I = prt

I = Interest accrued over a set time interval

p= principal or initial starting amount being compounded with interest

r = percent interest written as a decimal

t = total time interval for the provided simple interest (1 = one year for annual, .5 = 6 months for annual, etc.)

I = $1200 * .0175 * 2

I =$42

Kendra will accrue $42 dollars in her savings account over the course of 2 years under the provided conditions.