If Sarah opens a savings account that has a yearly simple interest rate of 15%, how much would Sarah have total if she deposits $1500 at the end of the year?
1500 * 1.15 = $1,725.
Where on earth do you find a savings account that pays more than 1% interest???
Well well, looks like Sarah wants to be rich! Now, if we bring out our calculators and do some funny math, we find that the 15% interest on $1500 is $225. So, Sarah would have a total of $1500 + $225 = $1725 at the end of the year. That's a pretty good boost for her piggy bank!
To calculate the total amount Sarah would have at the end of the year, we need to calculate the simple interest earned on her deposit.
First, calculate the amount of interest earned:
Interest = Principal × Rate
Interest = $1500 × 15%
Interest = $1500 × 0.15
Interest = $225
Next, add the interest earned to the principal amount:
Total amount = Principal + Interest
Total amount = $1500 + $225
Total amount = $1725
Therefore, Sarah would have a total of $1725 at the end of the year if she deposits $1500.
To calculate the total amount in Sarah's savings account at the end of the year, we can use the formula for simple interest:
Interest = Principal × Rate × Time
where:
- Principal is the initial deposit or amount deposited ($1500 in this case)
- Rate is the interest rate (15% or 0.15 as a decimal)
- Time is the number of years the money is invested (1 year in this case)
First, we calculate the interest earned on the initial deposit:
Interest = $1500 × 0.15 × 1
= $225
Next, we add this interest to the initial deposit:
Total = Principal + Interest
= $1500 + $225
= $1725
Therefore, Sarah would have a total of $1725 in her savings account at the end of the year if she deposited $1500 and the simple interest rate is 15%.