Question

Jack invests $350 in a savings account that earns 1.5% simple interesi annually. If he does not make any additional deposits or withdrawals, how much money will be in the savings account after 2 years?

Answer 1

The interest does not compound, but multiplied by the number of periods.

If the initial capital is C=350, the interest rate is r=0.015, and the number of periods is n=2, we can calculate:

$FV=C(1+nr)^{}=350\cdot(1+2\cdot0.015)^{}=350\cdot1.03=360.50$

After 2 years, he will have $360.50 in his account.