Answer: Interest on A = $300 , Interest on B = $262.5
Step-by-step explanation:
Formula for finding simple interest
I = P x R x T
----------- , Where P = Principal Invested., R = Interest Percentage and
100
T = Time or duration of the investments.
Account (A) simple interest =
I = 2,500 x 4 x 3
-------------------
100
= 25 x 12
= 1200/4
= $300
Therefoe account A interest at the end of the 3rd year = $300
Now for account ( B ) at te same principal of $2,500
I = 2,500 x 6 x 21 months
------------------------------ , Please bear in mind that the 21 months needs to
100,
to be converted to year because the formula only obey years and not in months
Therefore, the 21 years = 1 year 9 months since 12 calender months makes a year. Now , 9 month therefore is 3/4 of a year, so
21 months = one three quarter of a year. ( 1³/₄ )
21 months = 7/4 converted to improper fraction.
Now substitute this in the formula above
I = 2500 x 6 x 7
------------------
100 x 4
= 25 x 21
---------
2
= 2100
-------
2 x 4
= 2100
------
8
= $262.5
