if principle = 500, interest =5% and time = 5 years, what is the interest earned?

To calculate the interest earned, you can use the formula for simple interest:

\[
\text{Interest} = \text{Principal} \times \text{Rate} \times \text{Time}
\]

Where:
- Principal = $500$
- Rate = $5\% = 0.05$
- Time = $5$ years

Now, substituting the values into the formula:

\[
\text{Interest} = 500 \times 0.05 \times 5 = 125
\]

The interest earned is **$125**.

Would you like further details or explanations? Here are some related questions you might find interesting:

1. How does compound interest differ from simple interest?
2. What would the total amount be after 5 years, including the principal and interest?
3. How would the interest change if the rate were 7% instead of 5%?
4. What is the formula for calculating compound interest?
5. Can you explain how to calculate interest for different time periods (e.g., months instead of years)?

**Tip:** Always check whether the interest is simple or compound before using the formulas!

Learn how to calculate the interest earned on a principal of $500 at a 5% interest rate over 5 years. This step-by-step guide covers the simple interest formula and provides key financial concepts. Suitable for students in Grades 6-8.

Math Problem Statement

Solution

Ask a new question for Free

By Image

Math Problem Analysis

Mathematical Concepts

Formulas

Theorems

Suitable Grade Level

Related Recommendation