Chapter SH, Problem 7.8MPS

To determine

To calculate: To find the simple interest

Answer to Problem 7.8MPS

Simple interest is $\$948.75$

Explanation of Solution

Given information: Kira’s parents started a college fund by depositing $\$5500$ in a savings account at an interest rate of $5.75\%$ for $3$ years

Formula Used:

Simple interest is calculated as

  $SI=\frac{P\times R\times t}{100}$

Where,

  $P=$ Principal

  $R=$ Rate of interest

  $t=$ Time in years

Calculation:

Given that Kira’s parents started a college fund by depositing $\$5500$ in a savings account at an interest rate of $5.75\%$ for $3$ years

Thus,

  $\begin{array}{l}P=5500\\ R=5.75\%\\ t=3years\end{array}$

Simple interest is calculated as

  $SI=\frac{P\times R\times t}{100}$

Substituting the values,

  $\begin{array}{l}SI=\frac{5500\times 5.75\times 3}{100}\\ SI=55\times 5.75\times 3\\ SI=948.75\end{array}$

Conclusion:

Hence, the simple interest is $\$948.75$