QuestionDeshaun deposits \ $4000 at 3% simple interest. What interest will he earn in 2 years?$ I = P \times r \times t$

Studdy Solution

STEP 1

Assumptions1. The initial deposit is $4,000. The interest rate is3%
3. The time for calculating interest is years4. The interest is calculated using simple interest, not compounding

STEP 2

First, we need to find the interest amount on the deposited sum. We can do this by multiplying the deposited amount by the interest rate and the time in years.
$Interest = Principal\, amount \\times Interest\, rate \\times Time$

STEP 3

Now, plug in the given values for the principal amount, interest rate and time to calculate the interest.
$Interest = \$,000 \\times3\% \\times2\, years$

STEP 4

Convert the percentage to a decimal value.
$3\% =0.03$ $Interest = \$4,000 \\times0.03 \\times2\, years$

STEP 5

Calculate the interest amount.
$Interest = \$4,000 \\times0.03 \\times2 = \$240$ Deshaun will be paid $240 in interest in the first2 years.

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