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Steve invested $ 10,000 in a savings bank account that earned 2% simple interest. Find the interest earned if the amount was kept in the bank for 4 years.
  • a)
    $ 500
  • b)
    $ 650
  • c)
    $ 775
  • d)
    $ 800
Correct answer is option 'D'. Can you explain this answer?
Verified Answer
Steve invested $ 10,000 in a savings bank account that earned 2% simpl...
Principle P = $ 10,000 Time Period T =4 years and Rate of Interest = 2% = 0.02

Plugging these values in the simple Interest formula,
I = PX T X R

= 10,000 X 4 x 0.02

= $ 800

Interest earned for the investment = $ 800
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Most Upvoted Answer
Steve invested $ 10,000 in a savings bank account that earned 2% simpl...
Calculation of Interest Earned:
To find the interest earned on the principal amount, we can use the formula for simple interest:

Simple Interest (SI) = Principal × Rate × Time
Given:
Principal amount (P) = $10,000
Rate of interest (R) = 2%
Time (T) = 4 years

Calculating Interest Earned:
Using the formula for simple interest:
SI = $10,000 × 2% × 4 years
SI = $10,000 × 0.02 × 4
SI = $800
Therefore, the interest earned on the principal amount of $10,000 kept in the bank for 4 years at a simple interest rate of 2% is $800.
So, the correct answer is option 'D' - $800.
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Steve invested $ 10,000 in a savings bank account that earned 2% simple interest. Find the interest earned if the amount was kept in the bank for 4 years.a)$ 500b)$ 650c)$ 775d)$ 800Correct answer is option 'D'. Can you explain this answer?
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