SOLUTION: Birute deposits $500 in a savings account with a simple interest rate of 1.3%. How could you use this information to find the interest she would earn in 4 years and determine the

Question 1104554: Birute deposits $500 in a savings account with a simple interest rate of 1.3%. How could you use this information to find the interest she would earn in 4 years and determine the percent change in her savings account?

Found 2 solutions by Boreal, greenestamps:
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
interest is p*r*t
Here, it would be 500(1.013)^4, which is the 1.3% interest rate over 4 years.
The amount after 4 years would be $526.51, so the interest earned would be $26.51
Answer by greenestamps(13200) (Show Source): You can put this solution on YOUR website!

The other tutor used compound interest instead of simple interest....

With simple interest of 1.3% for 4 years, the interest is 5.2% of the original amount (1.3%, times 4).

i = p*r*t: interest equals (principal) times (rate) times (time)

The amount of interest is $26.
The percent change in the value of the account is 5.2%.
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