Question

Casey deposited $1,450 in a bank account with interest rate 4%. How much interest was earned in two years?

Short answer

The interest earned in two years will be $116.

Step-by-step solution

Step. 1 Given Information

We have principle amount $p=\$1,450$

Rate of interest $r=4\%=0.04$

Time $t=2years$

Step. 2 Formula and calculation for simple interest

As we know the formula to find the simple interest is:

$$\begin{gathered} I=prt, \\ wherepisindollars,ristherate,andtisthetimeinyears. \end{gathered}$$

So, putting the values in the formula we get the total interest earned which is as follows:

$$\begin{gathered} I=prt \\ I=1,450\times 0.04\times 2 \\ I=116 \end{gathered}$$

So, the total interest earned is $116.