How much interest will be earned on $8,000 over a period of four months if the interest rate is 6.5%?
A) $7,830.34
B) $173.33
C) $169.66
D) $130.00
E) $26.00

Question

Quizplus · Accepted Answer

The interest earned can be calculated using the formula for simple interest: Interest = Principal × Rate × Time. Here, Principal = $8,000, Rate = 6.5% per annum (or 0.065 when expressed as a decimal), and Time = 4 months (or 4/12 years). Thus, Interest = $8,000 × 0.065 × (4/12) = $173.33.

How Much Interest Will Be Earned on $8,000 Over a Period