Lindseyhas$79,152inasavingsaccountthatearns9%annually.Theinterestisnotcompounded.Howmuchwillshehaveintotalin4months?
Question
Lindsey has $79,152 in a savings account that earns 9% annually. The interest is not compounded. How much will she have in total in 4 months?
Solution
To calculate the total amount Lindsey will have in 4 months, we need to first calculate the annual interest she earns, and then adjust it for the 4-month period.
- Calculate the annual interest: Interest = Principal amount * rate of interest = 7,123.68
This is the amount of interest Lindsey earns in one year.
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Since the interest is not compounded, we can simply calculate the interest for 4 months by dividing the annual interest by 12 (to get the monthly interest) and then multiplying by 4.
4-month interest = (Annual interest / 12) * 4 = (2,374.56
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Finally, add the interest earned in 4 months to the initial amount in the savings account to get the total amount Lindsey will have in 4 months.
Total amount = Initial amount + 4-month interest = 2,374.56 = $81,526.56
So, Lindsey will have $81,526.56 in total in her savings account after 4 months.
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