Question

I l value ul Money-Requires Respondus LockDown Browser Started: Nov 9 at 2:36pm Quiz Instructions This is a timed exam. There are 10 questions and you have 60 minutes to complete it. You may backtrack after you have answered a questions and before you submit your quiz/exam. You have three attempts and the highest grade of these three attempts will be recorded as your grade for the quiz For multiple choice questions, please select the 'best' answer among the given choices. For calculation questions where you are required to enter a numerical answer, please read the instructions for the question carefully to make sure you enter the answer in the required format with the required precision (.e. the number of digits after the decimal point). Good luck! Question 3 10 pts In how many years will $150 become $300 at a simple interest (ie. no compounding) rate of 0.2% per year? 100 years 300 years 400 years 500 years Next • Previous Submit Quiz No new data to save. Last checked at 2:16pm

Answer 1

Question 3

For computing Simple Interest the formula is A = P(1+rt)

where,        A = Total Accrued amount, i.e Principal + Interest

                   P = Principal Amount

                   r = rate of Interest

                   t = Time Period

In the above question,

Total amount to be accrued is $ 300 , i.e, A = $300

Principal Amount is $ 150, i.e. P = $150

rate of interest is 0.2% per year, i.e. r = 0.2% or 0.002

By applying the above formula,   A = P (1+rt)

                                                 $300 = $150 (1+0.2%*t)

                                      $300 / $150 = 1+0.002t

                                                       2 = 1+0.002t

                                                  2 - 1 = 0.002t

                                                       1 = 0.002t

                                                        t = 1/0.002

                                                        t = 500 Years

Therefore, the time period it takes 500 years.