Question

john deposits $5000 into an account that pays simple interest at a rate of 4% per year. how much interest will he be paid in the first 4 years?

Explanation:

Step1: Recall simple interest formula

The simple interest formula is $I = P \times r \times t$, where $P$ is principal, $r$ is annual interest rate, $t$ is time in years.

Step2: Identify given values

$P = \$6000$, $r = 4\% = 0.04$, $t = 4$ years

Step3: Calculate the interest

$I = 6000 \times 0.04 \times 4$
$I = 240 \times 4$
$I = 960$

Answer:

$\$960$