Assume a 6-month CD purchased for $5,000 pays simple interest at an annual rate of  9.5%. How much interest does it earn? 

To calculate the interest earned on a 6-month Certificate of Deposit (CD) with simple interest, we can use the formula for simple interest:

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

Where:
- $I$ is the interest,
- $P$ is the principal (the initial amount invested),
- $r$ is the annual interest rate (as a decimal),
- $t$ is the time in years.

### Given:
- $P = 5,000$ (the principal),
- $r = 9.5\% = 0.095$ (the annual rate),
- $t = 6$ months $= \frac{6}{12} = 0.5$ years.

Now, plug these values into the formula:

\[
I = 5,000 \times 0.095 \times 0.5
\]

\[
I = 237.5
\]

### The interest earned is $237.50.

Would you like further details or have any questions?

Here are some related questions you might find interesting:
1. What would the interest be if the CD lasted for a full year?
2. How does compound interest differ from simple interest in such calculations?
3. How would the interest change if the rate was 8% instead of 9.5%?
4. What happens to the interest if the CD term is reduced to 3 months?
5. How would reinvesting the interest every 6 months affect the earnings?

**Tip**: For simple interest, the interest does not compound. It’s a straightforward calculation based solely on the original principal.

Assume a 6-month CD purchased for $5,000 pays simple interest at an annual rate of 9.5%. How much interest does it earn?

Learn how to calculate the simple interest earned on a 6-month Certificate of Deposit (CD) with a principal of $5,000 at an annual rate of 9.5%. This problem demonstrates the use of the simple interest formula and percentage calculations, ideal for students in Grades 8-10.

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