posted by Ranya
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
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.
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.
Interest before the rate was changed=4000x7.25x2/100
Interest after the rate was changed=4000x7.6x5/100
Total money Mrs. Jasmine has after 7 years=$4000+$1520
The above question I answered had a typing mistake. The total money Mrs. Jasmine has after 7 years is=$4000+$2100