Part 2 Assignment (6 problems)

Use simple interest to find the ending balance!

1. If I invest $210 at 8% for 7 years. What is my ending balance?

Answer:

I

2. If I invest $14,000 at 6% for 9 years. What is my ending balance?

Answer:

3. If I invest $1,900 at 5.9% for 2.75 years. What is my ending balance?

Answer:

1. $327.60

2. $21,560.00

3. $2,208.28

Step-by-step explanation:

The formula for simple interest is:

I = Prt

where

I = amount of interest

P = principal amount

r = annual interest rate

t = number of years

The total future amount after earning simple interest is the principal polus the interest.

F = P + Prt

F = P (1 + rt)

1.

F = P (1 + rt)

F = $210 (1 + 0.08 * 7)

F = $327.60

2.

F = P (1 + rt)

F = $14,000 (1 + 0.06 * 9)

F = $21,560.00

3.

F = P (1 + rt)

F = $1,900 (1 + 0.059 * 2.75)

F = $2,208.28