PROBLEM
Simple Interest
Method
Step 1
write out parameters
Principal P = $1,000
Rate R = 6%
Time T = 18 years
Interest = I
Step 2
write out the simple interest formula
[tex]\begin{gathered} I\text{ = }\frac{P\text{ X R X T}}{100} \\ \end{gathered}[/tex]Step 3
substitute values in the formular
[tex]\begin{gathered} I\text{ = }\frac{1000\text{ x 6 x 18}}{100} \\ I\text{ = }\frac{108000}{100} \\ I\text{ = \$1080} \end{gathered}[/tex]Amount in the account = Principal + Interest
= $1000 + $1080
= $2080
