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Frank has $500 in a savings account that earns 2% interest per year. The interest is not compounded. How much interest will Frank earn in 5 years?

Respuesta :

semsee45

Answer:

$50 interest

Step-by-step explanation:

Simple interest formula

I = Prt

where:

  • I = interested earned
  • P = principal amount
  • r = interest rate (in decimal form)
  • t = time (in years)

Given:

  • P = $500
  • r = 2% = 0.02
  • t = 5 years

Substitute the given values into the formula and solve for I:

⇒ I = 500 · 0.02 · 5

⇒ I = 50

Therefore, Frank will earn $50 interest in 5 years.

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