You invested a certain amount of money in an account which paid you $375 in simple interest at a rate of 3.8% over the course of 5 years. How much did you invest? Round your answer to the nearest cent.

To find out how much you invested, you can use the formula for simple interest:

\[
I = P \times r \times t
\]

Where:
- $ I $ is the interest earned ($375 in this case),
- $ P $ is the principal amount (the initial investment, which we need to find),
- $ r $ is the annual interest rate (3.8%, or 0.038 as a decimal),
- $ t $ is the time the money is invested for (5 years).

Rearranging the formula to solve for $ P $:

\[
P = \frac{I}{r \times t}
\]

Substituting the known values:

\[
P = \frac{375}{0.038 \times 5}
\]

Let's calculate this.

\[
P = \frac{375}{0.19} \approx 1973.68
\]

So, you invested approximately **$1,973.68**.

Would you like further details or have any questions? Here are some related questions:

1. What is the formula for compound interest?
2. How does simple interest differ from compound interest?
3. If the interest rate had been 4.5%, how much would the interest earned be?
4. What would be the principal if the interest earned was $500 instead?
5. How would the investment change if it were for 10 years instead of 5?

**Tip:** Simple interest is calculated only on the principal amount, not on accumulated interest, unlike compound interest.

Find out how to calculate the initial investment amount when given $375 in simple interest at a rate of 3.8% over 5 years. This problem covers key concepts in simple interest calculation and is suitable for students in Grades 6-8.

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