Question

You invest $5000 in an account at 5.5% per year simple interest. How much will you have in the account after 5 years?

Answer 1

`$5000+$1375 = $6375`

Explanation:

With simple interest, interest is calculated on only the original amount.

`color(white)(WWWWWWWWWWW)P= "principal"`
`SI = (PRT)/100color(white)(WWWWWW)T="Time in years"`
`color(white)(WWWWWWWWWWW)R= "Rate of interest"`

`SI= (5000xx5.5xx5)/100" "larr` this is the amount of interest

`SI= 1375`

The amount in the account will the original amount of `$5000` plus the interest of `$1375`

`$5000+$1375 = $6375`

Answer 2

`i=$1375`

Explanation:

The formula is `Prt+i` where P is the principle, r=the interest rate as a decimal, t= the time in years, and i= the amount of interest.

`5000*0.055*5=i`
`i=$1375`