Compute the amount of interest earned in the following simple interest problem. A deposit of $8,000 at 9.5% for 120 days.
8000 * 0.095 * 120/365
To compute the amount of interest earned in a simple interest problem, you need to know the principal amount, the interest rate, and the time period.
In this case, the principal amount is $8,000, the interest rate is 9.5%, and the time period is 120 days.
The formula for calculating simple interest is:
Interest = (Principal * Rate * Time) / 365
First, convert the interest rate from a percentage to a decimal by dividing it by 100:
Rate = 9.5% / 100 = 0.095
Next, substitute the values into the formula:
Interest = ($8,000 * 0.095 * 120) / 365
Now, multiply the principal amount, the interest rate, and the time period:
Interest = ($760 * 120) / 365
Interest = $91,200 / 365
Interest ≈ $249.86
Therefore, the amount of interest earned in this simple interest problem is approximately $249.86.