rodney opens a saving account and deposits 3000 dollars. the saving account earn 5% yearly simple terest. If rodney does not deposit any additional money into the account, how much compound interest did she earn over all 3 years
none - it's simple interest
To calculate the compound interest earned over 3 years, we need to compute the interest for each year and then sum them up.
First, let's calculate the yearly interest using the simple interest formula:
Simple Interest = Principal Amount × Interest Rate × Time
In this case, the principal amount (P) is $3000, the interest rate (R) is 5% (or 0.05 as a decimal), and the time (T) is 1 year.
So, for a single year, the interest earned would be:
Interest = $3000 × 0.05 × 1 = $150
Now, to find the compound interest earned over 3 years, we multiply the interest earned in each year by the number of years (3) and add them together:
Compound Interest = Interest * Time
Compound Interest = $150 * 3 = $450
Therefore, Rodney earned a total of $450 in compound interest over the course of 3 years.