Jayden opens a savings account with $100.00. His account earns 4% simple interest annually. How much money will be in his account one year later if he makes no deposits or withdrawals?
(1 point)
Responses
$96.00
$96.00
$100.00
$100.00
$104.00
$104.00
$148.00
The correct answer is $104.00.
To calculate the amount of money in Jayden's account after one year, we need to add the interest earned to the initial deposit.
The formula to calculate simple interest is:
Interest = Principal * Rate * Time
In this case, the initial deposit (Principal) is $100.00, the interest rate (Rate) is 4% (or 0.04 as a decimal), and the time (Time) is 1 year.
Interest = $100.00 * 0.04 * 1 = $4.00
Adding the interest earned to the initial deposit, we get:
$100.00 + $4.00 = $104.00
Therefore, there will be $104.00 in his account one year later if he makes no deposits or withdrawals.