Chapter 6.6, Problem 4GP

To determine

To find: Simple interest.

Answer to Problem 4GP

Simple interest $=I=\$754.69$

Explanation of Solution

Given information:

Principal amount $=\$3750$

Time $=42$ months.

Interest percent $=5.75\%$

Concept:

  $I=prt$

Where

  $I=$ Simple interest.

  $p=$ Principal amount

  $t=$ time in years.

  $r=$ Annual interest rate.

Calculation:

From given information

Principal amount $=p=\$3750$

Time $=t=42$ months.

We know

  $1$ year $=12$ months

Using that

We get

Time $=t=\frac{42}{12}=\frac{7}{2}$ years.

Interest percent $=R=5.75\%$

We know

Annual interest rate $=r=\frac{R}{100}$

  $\begin{array}{l}\Rightarrow r=\frac{5.75}{100}\\ \Rightarrow r=0.0575\end{array}$

On substituting values in above mentioned concept

We get

  $\begin{array}{l}I=prt\\ \Rightarrow I=\left(3750\right)\left(0.0575\right)\left(\frac{7}{2}\right)\\ \Rightarrow I=\$754.6875\end{array}$

Therefore,

To nearest cent, Simple interest $=I=\$754.69$