Question 1091200
The formula for simple interest is
{{{A = P(1+rt)}}}
where A is the final amount, P is the principal (initial) amount, r is the rate in decimal form, and t is the number of years.
This question is a little different than the norm, in the sense that we are not giving the principal or final amount, but rather a way to connect the two.  We want to have made $650 after 2 years.  So if we put P dollars in, we want to receive (P + 650) at the end of 2 years.  So for us, A = P + 650.  Our rate in decimal form is 0.125 and our t is 2.  So let's set that equation up.
{{{P + 650 = P(1 + 0.125*2)}}}
{{{P + 650 = P(1.25)}}}
Subtracting P from both sides, we get
{{{650 = 0.25P}}}
Thus, P = 2600.
So if the man wants to make $650 after 2 years, he needs to put $2600 in the bank initially.