Calculate the simple interest on a $100,000 investment at an interest rate of 12 percent a year after 6 months.
To calculate the simple interest, we need to start by converting the interest rate to a decimal form. The interest rate of 12% can be written as 0.12.
Next, we need to determine the time period for which the interest is calculated. In this case, it is 6 months. However, interest is usually calculated in terms of years, so we need to convert the time period to years.
Since there are 12 months in a year, 6 months is equal to half a year. Therefore, the time period in years is 1/2 or 0.5.
Now we can calculate the simple interest using the formula:
Simple Interest = Principal x Interest Rate x Time Period
Principal = $100,000
Interest Rate = 0.12 (12% expressed as a decimal)
Time Period = 0.5 (converted from 6 months to years)
Simple Interest = $100,000 x 0.12 x 0.5 = $6,000
Therefore, the simple interest on a $100,000 investment at an interest rate of 12 percent a year after 6 months would be $6,000.