Investor puts $3000 into a life insurance policy that pays 7.5% simple annual interest. If no additional investment is made into the policy how much accumulated interest should the investor expect at the end of 9 years
To calculate the accumulated interest, we can use the formula:
I = P * r * t
Where:
I = accumulated interest
P = initial investment
r = interest rate (in decimal form)
t = time (in years)
Given:
P = $3000
r = 7.5% = 0.075 (in decimal form)
t = 9 years
Plugging in these values into the formula, we get:
I = $3000 * 0.075 * 9
I = $2025
Therefore, the investor should expect an accumulated interest of $2025 at the end of 9 years.