Question

interest earned: ?
principal: $1250
interest rate: 3%
time: 4 years

Answer 1

I = P * r * t
I = 1250 * 0.03 * 4
I = $150

Therefore $150 interest was earned

Answer 2

Interest
I = prt
I = (1250)(0.03)(4)
I = $150.00

Compound interest
FV = PV (1+r) ^ t
FV = 1250 (1+0.03)^4
FV = $1406.89