How much interest is earned if a person has an initial deposit of $780, earns 3.8% simple interest, and leaves it in the bank for 2 years.

To calculate the interest earned using simple interest, we use the formula:

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

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

Given:
- $ P = 780 $ dollars,
- $ r = 3.8\% = 0.038 $,
- $ t = 2 $ years.

Now, calculating the interest:

\[
I = 780 \times 0.038 \times 2 = 59.28 \text{ dollars}
\]

So, the interest earned is **$59.28**.

Would you like more details or have any questions?

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Here are some related questions to expand your understanding:
1. How does compound interest differ from simple interest?
2. What would the interest be if the rate was compounded annually instead?
3. How much would the total amount in the account be after 2 years?
4. What happens if the interest rate changes midway during the deposit period?
5. How does increasing the time affect the total interest earned?

**Tip:** To avoid errors, always convert percentage rates to decimals by dividing by 100 before calculating.

Learn how to calculate simple interest for an initial deposit of $780 at a 3.8% interest rate over 2 years. This step-by-step guide uses the simple interest formula to determine that the interest earned is $59.28. Suitable for students in Grades 5-7.

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