Question

You put $\$550$ in an account that earns $4.4\%$ simple interest per year. How much interest do you earn in $6$ months?

• A. $1.21
• B. $12.10
• C. $121.00
• D. $145.20

Answer 1

The correct option is B

$12.10

Calculate the simple interest

we know, Simple Interest is $\mathrm{SI}=\frac{\mathrm{P}\times \mathrm{R}\times \mathrm{T}}{100}$

Principal amount : $\mathrm{P}=\$550$

Rate of Interest = $T=4.4\%$

Time: T= 6 months =$\frac{1}{2}$ year = 0.5 year

We know that formula for Simple Interest is $\mathrm{SI}=\frac{\mathrm{P}\times \mathrm{R}\times \mathrm{T}}{100}$

$$\begin{gathered} \mathrm{SI}=\frac{550\times 4.4\times 0.5}{100} \\ \mathrm{SI}=\frac{1210}{100} \\ \mathrm{SI}=12.10 \end{gathered}$$

So, we get the simple interest as $\$12.10$

Hence, the correct answer is option B.