Calculate the maturity value of a 300-day, $6,000 term deposit earning 5.15% simple interest.
A) $5,756.34
B) $6,253.97
C) $6,309.00
D) $6,111.78
E) $7,021.99

Question

Quizplus · Accepted Answer

The maturity value of a term deposit can be calculated using the formula for simple interest: $A = P(1 + rt)$, where $A$ is the amount of money accumulated after n years, including interest, $P$ is the principal amount (the initial amount of money), $r$ is the annual interest rate (decimal), and $t$ is the time the money is invested for in years. For this problem, $P = $6,000$, $r = 5.15\% = 0.0515$, and $t = 300/365$ years (since there are 365 days in a year). Plugging these values into the formula gives: $A = 6000(1 + 0.0515 \times (300/365)) = $6,253.97$.

Calculate the Maturity Value of a 300-Day, $6,000 Term Deposit