Asked by Paige Pressler on Jun 24, 2024
Verified
How much interest will be earned on $8,000 over a period of four months if the interest rate is 6.5%?
A) $7,830.34
B) $173.33
C) $169.66
D) $130.00
E) $26.00
Interest Rate
The percentage of a sum of money charged for its use, typically expressed as an annual percentage.
Period
A specified duration of time characterized by particular events, conditions, or phenomena.
Interest
The expense associated with taking out a loan, usually shown as a percentage of the total amount loaned.
- Work out simple interest and foundational principles.
Verified Answer
MS
makayla snyderJun 25, 2024
Final Answer :
B
Explanation :
The interest earned can be calculated using the formula for simple interest: Interest = Principal × Rate × Time. Here, Principal = $8,000, Rate = 6.5% per annum (or 0.065 when expressed as a decimal), and Time = 4 months (or 4/12 years). Thus, Interest = $8,000 × 0.065 × (4/12) = $173.33.
Learning Objectives
- Work out simple interest and foundational principles.