Question

if $400 is invested at the rate of 6% for one year, what will bet the total value of the investment (the amount)?

A) $42.40
B) $424.00
C) $4,240.00

Answer 1

Find 6% of $400 and add to $400.

6% of $400 =

= 6% * $400

= 0.06 * $400

= $24

6% of $400 is $24. That is the interest earned on $400 at 6% for 1 year.

Now we add it to the original amount, $400.

$400 + $24 = $424

Answer: $424

Answer 2

The correct answer would be B) $424.00

To get interest value, you have to multiply the total investment, the percent as a decimal and the amount of years it was in the bank. 

In this case, the equation would be:

400 x .06 x 1

The result is $24

We add that to the original investment of $400 and there is our total!

Have a splendid day!