Mrs jasmine Invested $4000 in a building society which paid simple interest at a rate of 7.25% per annum to its investors. After 2 years, the rate was increased to 7.6% per annum. Find the amount she had T the end of 7 years
Interest before the rate was changed=4000x7.25x2/100
=$580
Interest after the rate was changed=4000x7.6x5/100
=$1520
Total Interest=$1520+$580
=$2100
Total money Mrs. Jasmine has after 7 years=$4000+$1520
=$6100
6100
The above question I answered had a typing mistake. The total money Mrs. Jasmine has after 7 years is=$4000+$2100
=$6100
Do the first 2 years at the regular amount then ADD it to the final five years at the new amount. Both parts using the simple interest equation.
6320.4
To find the amount Mrs Jasmine had at the end of 7 years, we need to calculate the interest earned for each period and add it to the initial investment.
First, let's calculate the interest earned during the first 2 years.
Interest = Principal * Rate * Time
Interest = $4000 * 7.25% * 2 years
Interest = $4000 * 0.0725 * 2
Interest = $580
After 2 years, the rate increased to 7.6% per annum. We will now calculate the interest earned for the remaining 5 years.
Interest = Principal * Rate * Time
Interest = ($4000 + $580) * 7.6% * 5 years
Interest = $4580 * 0.076 * 5
Interest = $1738
Now, let's find the total amount at the end of 7 years by adding the interest to the initial investment:
Total Amount = Principal + Interest
Total Amount = $4000 + $580 + $1738
Total Amount = $6318
Therefore, Mrs Jasmine had $6318 at the end of 7 years.
P1 = Po + Po*r*t = 4000 + 4000*0.0725*2 = $4580 After 2 yrs.
P = Po + Po*r*t = 4580 + 4580*0.076*5 = Amt. after 7 yrs.
After 2 years, the account becomes a new account with an initial investment of $4580 for 5 years.