#### Explanation:

We know Simple Interest ($S I$)= $P \times \frac{R}{100} \times T$

Where P = Principal amount, R = Rate of interest and. T = Time.

Here P = 2000, I = 5 and T = 5.

Hence $S I = 2000 \times \frac{5}{100} \times 5 = 500$

Dec 17, 2017

$\textcolor{b r o w n}{\text{The question does not declare the interest type used}}$

$566.72 to 2 decimal places $\leftarrow$compound interest $500.00 to 2 decimal places $\leftarrow$ simple interest

#### Explanation:

$\textcolor{b l u e}{\text{Compound interest}}$

$\textcolor{b r o w n}{\text{In real life this is the one that would be used}}$

The annual interest is distributed over each payment cycle.

For monthly calculation cycle we do have $\textcolor{w h i t e}{\text{ddd}} \frac{1}{12} \times \frac{5}{100} = \frac{5}{1200}$

Using $P {\left(1 + \frac{5}{1200}\right)}^{t}$

Note that $t$ is for 5 years at 12 cycles per year giving:

$2000(1+5/1200)^60 $2000(1205/1200)^60 = $2566.72 to 2 decimal places Interest is $2566.72
ul($2000.00 larr" Subtract") color(white)("d")$566.72

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
$\textcolor{b l u e}{\text{Simple interst}}$

5% ->5/100

Interest per year 5/100 xx$2000 =$100

Interest for 5 years  color(white)("d") 5xx $100 =$500