Question

tyreese invests $750 in an account that pays 3.8% simple annual interest. if he keeps the money in the account for 10 years, what will be the total value of the account?

Explanation:

Step1: Recall simple interest formula

The formula for simple interest is \( I = P \times r \times t \), where \( P \) is the principal amount, \( r \) is the annual interest rate (in decimal), and \( t \) is the time in years. The total value \( A \) of the account is the sum of the principal and the interest, so \( A = P + I \).

Step2: Convert the interest rate to decimal

The annual interest rate is \( 3.8\% \). To convert this to a decimal, we divide by 100: \( r = \frac{3.8}{100} = 0.038 \).

Step3: Calculate the simple interest

We know \( P = \$750 \), \( r = 0.038 \), and \( t = 10 \) years. Substitute these values into the simple interest formula:
\( I = 750 \times 0.038 \times 10 \)
First, calculate \( 750 \times 0.038 = 28.5 \). Then, multiply by 10: \( I = 28.5 \times 10 = \$285 \).

Step4: Calculate the total value of the account

The total value \( A \) is the principal plus the interest:
\( A = P + I = 750 + 285 = \$1035 \).

Answer:

\(\$1035\)