Question

A. Simple Interest (3 points each) 1) Ben deposited $6,500 in a simple interest account that pays 2.8% interest annually. If Ben leaves the money in the account for 12 years, how much interest will he earn

Answer 1

Answer:

Interest= $2,553.8

Explanation:

Giving the following information:

Ben deposited $6,500 in a simple interest account that pays 2.8% interest annually.

To calculate the final value and the interest, we need to use the following formula:

FV= PV*(1+i)^n

FV= 6,500*(1.028^12)= $9,053.80

Interest= final value - capital

Interest= 9,053.80 - 6,500= $2,553.8