Question

Donna deposits `$800` into an account that pays simple interest at a rate of `2%` per year. How much interest will she be paid in the first `5` years?

Answer 1

Donna will be paid `$80` as interest.

Explanation:

`SI=(PxxRxxT)/100`

Applying the formula for simple interest we get:

`SI=(800xx2xx5)/100`

`SI=(8cancel(00)xx2xx5)/(1cancel(00))`

`SI=8xx2xx5`

`SI=80`