Julie deposited $300 into a simple interest savings account that earns
1.34%. If no money is added or withdrawn from the account, about how
long will it take for the interest to equal the deposited amount?
A. 8 months
B. 1 year
C. 7 years
D. 75 years
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I = PRT
(300)(.0134)T = 300
.0134T = 1
T = appr 75
To find out how long it will take for the interest to equal the deposited amount, we need to calculate the interest earned over time. Here's how you can do it:
1. First, calculate the annual interest earned by multiplying the deposited amount ($300) by the interest rate (1.34% = 0.0134).
Annual interest = $300 * 0.0134 = $4.02
2. To find out how long it will take for the interest to equal the deposited amount, divide the deposited amount ($300) by the annual interest ($4.02).
Time taken = $300 / $4.02 ≈ 74.63 years
Based on the calculation, it will take approximately 74.63 years for the interest to equal the deposited amount.
Since the options provided are not exact, we can round the answer.
Therefore, the closest option is:
D. 75 years