smc-6965-10-Simple Interest

Financial Maths, STD1 F1 2024 HSC 21 v1

Tom borrowed $2400 at 5% per annum.

Calculate the simple interest for the first four months. (2 marks)

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$\$40$

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$\text{Interest}$	$=Prn$
	$=2400\times 0.05\times \dfrac{4}{12}=\$40$

Noah saw the following advertisement at his local bank in Newcastle:

Noah invests $6000 for a term of 9 months.

How much interest will Noah earn at the end of the term?

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$A$

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$P=\$6000,\ r=4.8\%=0.048,\ n=\dfrac{9}{12}\ \text{years}$

$I=Prn=6000 \times 0.048 \times \dfrac{9}{12}=\$216$

$\Rightarrow A$

Hayden invests $3000 for 1 year and 8 months. Simple interest is paid on the investment at a rate of 5% per annum.

What is the total value of the investment at the end of this period?

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$B$

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$\text{1 year and 8 months = 20 months}$

$I=Prn=3000 \times 0.05 \times \dfrac{20}{12}=\$250$

$\therefore\ \text{Value of Investment} =3000+250=\$3250$

$\Rightarrow B$

Mia deposits $4000 into a savings account at the Commonwealth Bank that pays simple interest at a rate of 4% per annum.

How much interest will she earn in the first three years?

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$C$

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$P=\$4000,\ r=4\%=0.04,\ n=3\ \text{years}$

$I=Prn=4000 \times 0.04 \times 3=\$480$

$\Rightarrow C$

\(\text{Interest}\)	\(=Prn\)
	\(=2400\times 0.05\times \dfrac{4}{12}=\$40\)