For Simple Interest Accounts the Interest Earned or Due Depends

question 25

Short Answer

For simple interest accounts the interest earned or due depends on the principal p, interest rate r, and the time t in years according to the formula I = prt.
Paul deposited $8400 in a savings account that pays 7.5% simple interest. How long will it take the account balance to reach $11,172.00 at this rate of interest, if no more deposits are made? (Hint: How much interest will be paid?)

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Definitions:

Acceptance

An agreement to the terms of an offer, thereby creating a binding contract.

Option

In finance, a contract that gives the buyer the right, but not the obligation, to buy or sell an asset at a predetermined price within a specified timeframe.

Revoking

The action of withdrawing, canceling, or annulling something previously granted, such as a privilege, right, or contract.

Offer

A proposal by one party to enter into a contract upon specified terms, subject to acceptance.