How many months would it take to earn $3,300 interest on a deposit of $84,000 at 9 ½%?
A) 4.14 months
B) 4.96 months
C) 11.2 months
D) 15.3 months
E) 25.4 months

Question

Quizplus · Accepted Answer

The interest earned can be calculated using the formula I = PRT, where I is the interest, P is the principal amount, R is the rate of interest per period, and T is the time period. Here, I = $3,300, P = $84,000, R = 9.5% or 0.095 per year, and T is what we need to find in months. First, convert the annual interest rate to a monthly rate by dividing by 12, which gives 0.095/12 per month. Then, rearrange the formula to solve for T: T = I / (P * R). Substituting the values and converting the time into months gives T = $3,300 / ($84,000 * 0.095/12) ≈ 4.96 months.

How Many Months Would It Take to Earn $3,300 Interest