SOLUTION: Assume a firm makes a $2500 deposit into its money market account. If this account is currently paying 0.7 %, what will the account balance be after 1 year ?

Question 513740: Assume a firm makes a $2500 deposit into its money market account. If this account is currently paying 0.7 %, what will the account balance be after 1 year ?
Answer by Devinthedev(1) (Show Source): You can put this solution on YOUR website!
Here is how you can solve this:
This is the formula you should use: I=prt or Interest= Principal(Rate)Time
Step 1: Move the decimal to the left 2 places to convert the percent to a decimal which comes out to .007 You insert this into the formula so it's I=p(.007)t
Step 2: The $2500 is the p or principal so you insert it into the formula so now it's I= (2500).007(t)
Step 3: The time is 1 year so you then insert it into the formula where the t is so it's I= (2500).007(1)
Step 4: You then have to multiply the numbers which comes out to 17.5 then you add the $17.50 to $2500
Solution: The firm's account balance after 1 year is $2517.50

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