Chapter 7.7, Problem 12E

To determine

To calculate: the interest and balance of the account after $6\text{months}$

Answer to Problem 12E

The interest is $\$4$ and balance of the account after $6\text{months}$ is $\$104$

Explanation of Solution

Given information: $P=\$100,r\text{=8\% simple interest per year },t=6\text{months}$

Concept Used:

Simple interest problem requires the use of the following formula:

  $\begin{array}{l}I=Prt\\ A=P+I\end{array}$

Calculation:

As per the given problem

  $P=\$100,r\text{=8\% simple interest per year },t=6\text{months=}\frac{1}{2}\text{years}$

Substitute the values in the formula

  $\begin{array}{l}I=Prt\\ \Rightarrow I=100\times \frac{8}{100}\times \frac{1}{2}\\ \Rightarrow I=4\end{array}$

And

  $\begin{array}{l}A=P+I\\ \Rightarrow A=100+4\\ \Rightarrow A=104\end{array}$

The interest is $\$4$ and balance of the account after $6\text{months}$ is $\$104$

Conclusion:

The interest is $\$4$ and balance of the account after $6\text{months}$ is $\$104$