Ben invests $450 in a savings account that earns 3% simple interest annually. If he does not make any additional deposits or withdrawals, how much money will be in the savings account after 2 years?

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Mathematics

Copper

28 January, 22:46

Ben invests $450 in a savings account that earns 3% simple interest annually. If he does not make any additional deposits or withdrawals, how much money will be in the savings account after 2 years?

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Olive Huerta · Answer 1

Hi there! The formula for simple interest is prt. That means multiply the principal (initial amount) by the percentage (simple interest rate) by time (could be in months or years. The initial amount in the bank is $450 and the interest rate is 3%. 450 * 3% (0.03) is 13.5. $13.50 is earned in interest each year. 13.5 * 2 is 27. $27 is earned in interest after two years. Let’s add the initial amount to get the total amount. 450 + 27 is 477. There. Ben will have $477 total in the bank after 2 years.