mrs.mendoza deposited 10,000.00 pesos in the bank. if the annual interest rate is 25%, how much interest will her deposit earn at the end of 5 years?
Answer (1)
Answer: Php 12,500Simple interest is the extra money earned (or paid) on a principal amount when money is deposited or borrowed. It is called simple because the interest is always based only on the original amount (principal) and does not change each year.Simple Interest Formula: I = P x r x tP (Principal) → the original amount of money,r (Rate) → the interest rate per year (in decimal form), andt (Time) → how many years the money is deposited or borrowed.Now you just substitute:P = 10,000r = 25% or 0.25t = 5I = 10,000 x .25 x 5 = 12,500
