Solve for time. Principle - $400 / Int 5% / simple interest $100
Earning interest at $20 per year (5% of $400), it will take you 5 years to earn $100.
To solve for time in this scenario, where the principal is $400, the interest rate is 5%, and the simple interest is $100, you can use the formula for simple interest:
Simple Interest = (Principal * Rate * Time) / 100
In this case, we are given the values for the principal and simple interest, so we can rearrange the formula to solve for time:
Time = (Simple Interest * 100) / (Principal * Rate)
Plugging in the given values:
Time = ($100 * 100) / ($400 * 5%)
Next, we need to convert the interest rate from a percentage to a decimal by dividing it by 100:
Time = ($100 * 100) / ($400 * 0.05)
Simplifying further:
Time = 10000 / 20
Time = 500
Therefore, the time it took to earn $100 in simple interest with a principal of $400 and an interest rate of 5% is 500 units of time (e.g., days, months, years, etc., depending on the context of the situation).