ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Starting money = $350.Interest rate = 2.5%Time = 3 years.How much simple interest is earned?
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7.50
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26.25
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87.5
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262.50
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Explanation:
Detailed explanation-1: -Hence, at the end of 3 years, the simple interest is $787.5.
Detailed explanation-2: -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-3: -The rate of simple interest at which a sum of money becomes three times in 25 yr is. 8%
Detailed explanation-4: -Therefore, it will take 50 years to get the double amount at a simple interest rate 2 % per annum.
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