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How much simple interest will $2,000 earn in 18 months at an annual

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How much simple interest will $2,000 earn in 18 months at an annual  [#permalink]

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New post 29 Oct 2017, 01:28
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A
B
C
D
E

Difficulty:

  15% (low)

Question Stats:

79% (00:49) correct 21% (00:36) wrong based on 68 sessions

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Re: How much simple interest will $2,000 earn in 18 months at an annual  [#permalink]

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New post 29 Oct 2017, 08:27
Bunuel wrote:
How much simple interest will $2,000 earn in 18 months at an annual rate of 6%?

(A) $120
(B) $180
(C) $216
(D) $1,800
(E) $2,160

\(Interest = 2000*\frac{18}{12}*\frac{6}{100}\)

So, \(Interest = 180\)

Thus, correct answer will be (B) $180
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Re: How much simple interest will $2,000 earn in 18 months at an annual  [#permalink]

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New post 08 Aug 2018, 03:34
Ans: B
We know for Simple interest Root money is always constant, so we can get it either by monthly calculation of by
6% for full year 3% for half and .5% for each month.
as we need to know for 1 full year and 1 half so
Interest = 2000*.06*.03 = 180 ans.

Bunuel wrote:
How much simple interest will $2,000 earn in 18 months at an annual rate of 6%?
(A) $120
(B) $180
(C) $216
(D) $1,800
(E) $2,160

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How much simple interest will $2,000 earn in 18 months at an annual  [#permalink]

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New post 08 Aug 2018, 09:58
1
Bunuel wrote:
How much simple interest will $2,000 earn in 18 months at an annual rate of 6%?

(A) $120
(B) $180
(C) $216
(D) $1,800
(E) $2,160

The question asks only for interest earned.

Simple interest formula - Interest only
\(I=P*r*t\)
\(P=\) principal
\(r=\) rate in decimal form
\(t=\) time in years

\(I=($2,000)(0.06)(1.5)\)
\(I=($2,000)(0.09)\)
\(I=($2,000*\frac{9}{100})=($20*9)=$180\)

Answer B

By hand
Each year, the $2,000 earns \(.06*$2,000=$120\)
That $120 interest payment per year never increases.

After 1 year = 12 months, interest earned: \($120\)

After 6 months = \(\frac{1}{2}\) a year, interest earned:
\((\frac{$120}{year}*\frac{1}{2}yr)=$60\)
Total interest earned: \(($120+$60)=$180\)

Answer B
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How much simple interest will $2,000 earn in 18 months at an annual &nbs [#permalink] 08 Aug 2018, 09:58
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