Find the interest to the nearest cent
Question #1
Amount: $5432
Annual Interest Rate: 6.2%
Time: 3 years
Question #2
$4500 at 5.5% for 4 1/2 years
Question #3
$3680 at 6.75% for 2 1/4 years
Question #4
5.5% for 1 3/4 years on $2543
I'm sorry for so many but I just don't understand them =]
The basic formula is Interest equals principal times rate times time or I = PRT.
For # 1:
I = 5432 * 0.062 * 3
I = 1010.35
Follow this pattern. We'll be glad to check your answers.
So for #2 the answer is 1113.75. But I still don't understand #3 and #4 because I don't know how to multiply the years. You know 2 1/4 and 1 3/4
You're right for # 2. :-)
It's easiest to use the decimal equivalents for the fractions of a year: 2 1/4 (2.25) and 1 3/4 (1.75).
# 3:
I = 3680 * 0.0675 * 2.25
Oh yea! It's like your counting by quarters. Man I forgot. My bad =] Thank You for the great help maybe I might come back for more help today. Again thanks for the great help!!
You're very welcome. And I look forward to helping you again.
I have a question, is the different wording of #4 significant? Because it says 5.5% for 1 3/4 years on $2543. I am not having any trouble with the others, just this one.
No problem! I can help you find the interest for each of the given scenarios.
Question #1:
To calculate the interest for the first scenario, we will use the simple interest formula:
Interest = Principal * Rate * Time
Principal = $5432
Rate = 6.2% (or 0.062 as a decimal)
Time = 3 years
Plugging these values into the formula, we get:
Interest = $5432 * 0.062 * 3 = $1006.65
Rounded to the nearest cent, the interest is $1006.65.
Question #2:
For the second scenario, we have:
Principal = $4500
Rate = 5.5% (or 0.055 as a decimal)
Time = 4.5 years
Using the same formula, we get:
Interest = $4500 * 0.055 * 4.5 = $1113.75
Rounded to the nearest cent, the interest is $1113.75.
Question #3:
Now let's calculate the interest for the third scenario:
Principal = $3680
Rate = 6.75% (or 0.0675 as a decimal)
Time = 2.25 years
Plugging these values into the formula:
Interest = $3680 * 0.0675 * 2.25 = $558.90
Rounded to the nearest cent, the interest is $558.90.
Question #4:
Lastly, we will calculate the interest for the fourth scenario:
Principal = $2543
Rate = 5.5% (or 0.055 as a decimal)
Time = 1.75 years
Using the same formula one more time:
Interest = $2543 * 0.055 * 1.75 = $247.77
Rounded to the nearest cent, the interest is $247.77.
I hope this helps you understand how to calculate interest! Let me know if you have any other questions.