SOLUTION: A philanthropist has donated $ 350,000.00 to habitat for humanity . the funds are to be set up in a trust account with them proceeds from interest earned to be used to build new ho

Question 887658: A philanthropist has donated $ 350,000.00 to habitat for humanity . the funds are to be set up in a trust account with them proceeds from interest earned to be used to build new homes. At a return rate of 4.5% and using them simple interest formula, how many months will it take to earn $40,000.00, then average amount it takes to build a house? Round your answer two decimal places. I thought the problems usually would tell you a certain time like in years I've tried working the problem I just really don't understand
Answer by ankor@dixie-net.com(22740) (Show Source): You can put this solution on YOUR website!
A philanthropist has donated $ 350,000.00 to habitat for humanity .
the funds are to be set up in a trust account with them proceeds from interest earned to be used to build new homes.
At a return rate of 4.5% and using the simple interest formula, how many months will it take to earn $40,000.00, the average amount it takes to build a house?
Round your answer two decimal places
:
This is a I = PRT problem, where
I = interest earned
P = the principal amt
T = time in years
:
350000 * .045 * t - 40000
15750t = 40000
t = 40000/15750
t = 2.5397 yrs
But they wanted the time in months
2.5397 * 12 = 30.48 months
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