ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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$2, 400 is deposited into an account that earns 5.25% simple interest for 3 years. Calculate the simple interest earned.
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$2798.19
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$2778
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$378
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$3780
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Explanation:
Detailed explanation-1: -Simple interest is calculated with the following formula: S.I. = P × R × T, where P = Principal, R = Rate of Interest in % per annum, and T = Time, usually calculated as the number of years. The rate of interest is in percentage r% and is to be written as r/100.
Detailed explanation-2: -Sum of Rs 400/-for 3 years at simple interest at 5% per annum. ∴ The amount is Rs. 460.
Detailed explanation-3: -Simple Interest Formula Thus, if simple interest is charged at 5% on a $10, 000 loan that is taken out for three years, then the total amount of interest payable by the borrower is calculated as $10, 000 x 0.05 x 3 = $1, 500.
Detailed explanation-4: -Expert-Verified Answer 240 as interest. 5% of 2400 RS = 120.
There is 1 question to complete.