Tom deposits $800 into an account that pays simple interest at a rate of 2℅ per year. How much interest will he be paid in the first 2 years
He will be paid $32. If you use a calculator or just divide by hand, 2% of 800 is 16. Then just multiply by 2.
I = Po*r*t = 800*0.02*2 = $32.
To calculate the interest Tom will be paid in the first 2 years, we need to use the formula for simple interest.
Simple Interest = (Principal Amount x Interest Rate x Time)
In this case, the principal amount is $800, the interest rate is 2% (which can be written as 0.02 in decimal form), and the time is 2 years.
Substituting these values into the formula, we get:
Simple Interest = (800 x 0.02 x 2)
Calculating the multiplication:
Simple Interest = 16
Therefore, Tom will be paid $16 in interest in the first 2 years.