Question

extra practice: session 2
for exercises 1 and 2, use the information to answer the questions.
quan opens a savings account at the beginning of the year with $950. his savings account has an annual interest rate of 0.5%.

1. if quan doesn’t make any additional deposits or withdrawals, how much interest will his account earn by the end of the year?

Explanation:

Step1: Convert rate to decimal

$0.5\% = \frac{0.5}{100} = 0.005$

Step2: Calculate simple interest

$I = P \times r \times t$
$I = 950 \times 0.005 \times 1$

Answer:

$4.75$