Example 6.39 from Prealgebra, 6.4 Solve Simple Interest Applications

Solve Simple Interest Applications: example 6.39

Caroline got $$900$ as graduation gifts and invested it in a $10-month$ certificate of deposit that earned $2.1%$ interest. How much interest did this investment earn?

Work it out on paper first. Then open the solution one step at a time, and stop as soon as you can finish on your own.

Your turn

The book's Try It right after this example: same idea, new numbers. Only the answer is given.

Adriana invested $$4,500$ for $8$ months in an account that paid $1.9%$ interest. How much interest did she earn?

How did it go?

Write the formula.	$I = P r t$
Substitute the given information, converting 10 months to $\frac{10}{12}$ of a year.	$I = $900 (0.021) (\frac{10}{12})$
Multiply.	$I = 15.75$
Check your answer. Is $15.75 a reasonable amount of interest?
If Caroline had invested the $900 for a full year at 2% interest, the amount of interest would have been $18. Yes, $15.75 is reasonable.
Write a complete sentence that answers the question.	The interest earned was $15.75.

Write the formula.	$I = P r t$
Substitute the given information, converting 10 months to $\frac{10}{12}$ of a year.	$I = $900 (0.021) (\frac{10}{12})$
Multiply.	$I = 15.75$
Check your answer. Is $15.75 a reasonable amount of interest?
If Caroline had invested the $900 for a full year at 2% interest, the amount of interest would have been $18. Yes, $15.75 is reasonable.
Write a complete sentence that answers the question.	The interest earned was $15.75.

Solve Simple Interest Applications: example 6.39

Solution

Your turn

Solve Simple Interest Applications: example 6.39

Solution

Your turn