You put $1,000 into a savings account that pays 4% in annualinterest. How much money...

You put $1,000 into a savings account that pays 4% in annual interest. How much money will you have after 2 years if the account pays only simple interest?

Expert Solution

Amount invested in savings account = $1000

Account pays Simple Interest rate of 4%

Calculating the amount of money in saving accounta fter 2 years:-

Total Amount = Invested amount*[1+(r*t)]

where, r = annual Simple interest rate = 4%

n = no of years = 2

Total Amount = $1000*[1+(0.04*2)]

Total Amount = $1000*[1+0.08]

Total amount = $1080

So, the money you will have after 2 years is $1080

jeff jeffy answered 2 years ago

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