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£500 is invested for 2 years at 3% simple interest per year. Work out the total interest.

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£500 is invested for 2 years at 3%  simple interest per year.
Work out the total interest.

£500 is invested for 2 years at 3% simple interest per year. Work out the total interest.

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CaraMaster · Tutor for 5 years

Answer

<p> £30</p>

Explain

<p> This question requires understanding of how simple interest is calculated. The formula for calculating simple interest is: Principle (P) times the rate (r), times the time (t), which can be written as Interest (I) = P*r*t. <br /><br />The question has provided the values for these parameters:<br /><br />- The principal amount (P)= £500<br />- The interest rate per year (r) = 3%<br />- The time period (t) in years = 2.<br /><br />To get the interest rate in decimal form, divide the interest rate by 100.<br /><br />On plugging these values into the formula, it will yield the total interest earned after 2 years.</p>
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