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14 January, 10:54

Mr. Alvarez's simple interest savings account currently has a balance of $12,500. He earns 6% Interest annually. Calculate his balance for one year

If no additional deposits are made,

A $13,250.00

B $12,506.00

C $13,500

D $12,560.00

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  1. 14 January, 11:22
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    A $13,250.00

    Explanation:

    The formula for calculating balance at the end of a period using simple interest is as below.

    A = P (1+rt)

    A = final amount

    P = principal amount which is $12500

    r = interest rate 6% or 0.06

    t = time which is 1 year

    A = $12,500 (1+0.06 x 1)

    A = $12500 x1.06 x 1

    =$12500 x 1.06

    =$13,250
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