Jonah Has $73,068 In A Savings Account. The Interest Rate Is 3% Per Year And Is Not Compounded. To The Nearest Cent, How Much Interest Will He Earn In 3 Years?Use The Formula I = P R T I = Prt I = P R T , Where:- I I I Is The Interest Earned,-

Understanding the Problem

Jonah has a savings account with a balance of $73,068. The interest rate on this account is 3% per year, and it is not compounded. In this scenario, we need to calculate the interest earned by Jonah in 3 years. To do this, we will use the formula for simple interest, which is given by:

Simple Interest Formula

The formula for simple interest is:

$$i = prt$$

where:

• $i$ is the interest earned
• $p$ is the principal amount (initial balance)
• $r$ is the interest rate (in decimal form)
• $t$ is the time period (in years)

Breaking Down the Problem

In this problem, we are given the following values:

• Principal amount ($p$): $73,068
• Interest rate ($r$): 3% = 0.03 (in decimal form)
• Time period ($t$): 3 years

We need to calculate the interest earned ($i$) using the formula.

Calculating Interest Earned

To calculate the interest earned, we can plug in the given values into the formula:

$$i = prt$$

$$i = 73068 \times 0.03 \times 3$$

$$i = 73068 \times 0.09$$

$$i = 6558.12$$

Therefore, to the nearest cent, Jonah will earn $6558.12 in interest in 3 years.

Interpretation of Results

The result indicates that Jonah will earn a total of $6558.12 in interest over a period of 3 years, assuming the interest rate remains constant at 3% per year and is not compounded.

Conclusion

In this article, we used the simple interest formula to calculate the interest earned by Jonah on his savings account over a period of 3 years. The result shows that Jonah will earn a total of $6558.12 in interest, assuming the interest rate remains constant at 3% per year and is not compounded.

Real-World Applications

The concept of simple interest is widely used in real-world applications, such as:

• Calculating interest on loans and credit cards
• Determining the interest earned on savings accounts and investments
• Understanding the impact of interest rates on financial decisions

Common Mistakes to Avoid

When calculating simple interest, it's essential to avoid common mistakes, such as:

• Forgetting to convert the interest rate from percentage to decimal form
• Misinterpreting the time period (e.g., using months instead of years)
• Failing to round the result to the nearest cent

Additional Resources

For further learning and practice, we recommend the following resources:

• Khan Academy: Simple Interest
• Mathway: Simple Interest Calculator
• Investopedia: Simple Interest Formula

Final Thoughts

Q: What is simple interest?

A: Simple interest is a type of interest that is calculated on the initial principal amount, without taking into account the interest that has already been earned. It is calculated using the formula: $i = prt$, where $i$ is the interest earned, $p$ is the principal amount, $r$ is the interest rate, and $t$ is the time period.

Q: What is the difference between simple interest and compound interest?

A: Simple interest is calculated only on the initial principal amount, while compound interest is calculated on both the principal amount and the interest earned. Compound interest is typically used in investments and savings accounts that are compounded regularly, such as monthly or quarterly.

Q: How do I calculate simple interest?

A: To calculate simple interest, you can use the formula: $i = prt$. You will need to know the principal amount, interest rate, and time period. You can then plug in the values and calculate the interest earned.

Q: What is the interest rate?

A: The interest rate is the percentage of the principal amount that is earned as interest. It is usually expressed as a decimal, such as 0.03 for a 3% interest rate.

Q: What is the principal amount?

A: The principal amount is the initial amount of money that is invested or borrowed. It is the amount on which the interest is calculated.

Q: What is the time period?

A: The time period is the length of time for which the interest is calculated. It is usually expressed in years, but can also be expressed in months or days.

Q: Can I use a calculator to calculate simple interest?

A: Yes, you can use a calculator to calculate simple interest. Most calculators have a built-in function for calculating interest, or you can use a formula calculator or online calculator.

Q: What are some real-world applications of simple interest?

A: Simple interest is used in a variety of real-world applications, including:

• Calculating interest on loans and credit cards
• Determining the interest earned on savings accounts and investments
• Understanding the impact of interest rates on financial decisions
• Calculating the total cost of a loan or investment

Q: What are some common mistakes to avoid when calculating simple interest?

A: Some common mistakes to avoid when calculating simple interest include:

• Forgetting to convert the interest rate from percentage to decimal form
• Misinterpreting the time period (e.g., using months instead of years)
• Failing to round the result to the nearest cent
• Not considering compounding interest

Q: Can I use simple interest to calculate compound interest?

A: No, simple interest is not used to calculate compound interest. Compound interest is calculated using a different formula, which takes into account the interest earned on both the principal amount and the interest earned.

Q: What are some resources for learning more about simple interest?

A: Some resources for learning more about simple interest include:

• Khan Academy: Simple Interest
• Mathway: Simple Interest Calculator
• Investopedia: Simple Interest Formula
• Online calculators and formula calculators

Q: Can I use simple interest to calculate interest on a loan or investment?

A: Yes, simple interest can be used to calculate interest on a loan or investment. However, it's essential to consider the compounding interest and the interest rate to get an accurate calculation.

Q: What are some tips for using simple interest in real-world applications?

A: Some tips for using simple interest in real-world applications include:

• Always convert the interest rate from percentage to decimal form
• Use the correct time period (e.g., years, months, days)
• Round the result to the nearest cent
• Consider compounding interest
• Use a calculator or online calculator to simplify the calculation

Q: Can I use simple interest to calculate interest on a credit card?

A: Yes, simple interest can be used to calculate interest on a credit card. However, it's essential to consider the compounding interest and the interest rate to get an accurate calculation.

Q: What are some common mistakes to avoid when using simple interest to calculate interest on a credit card?

A: Some common mistakes to avoid when using simple interest to calculate interest on a credit card include:

• Forgetting to convert the interest rate from percentage to decimal form
• Misinterpreting the time period (e.g., using months instead of years)
• Failing to round the result to the nearest cent
• Not considering compounding interest

Q: Can I use simple interest to calculate interest on a savings account?

A: Yes, simple interest can be used to calculate interest on a savings account. However, it's essential to consider the compounding interest and the interest rate to get an accurate calculation.

Q: What are some common mistakes to avoid when using simple interest to calculate interest on a savings account?

A: Some common mistakes to avoid when using simple interest to calculate interest on a savings account include:

• Forgetting to convert the interest rate from percentage to decimal form
• Misinterpreting the time period (e.g., using months instead of years)
• Failing to round the result to the nearest cent
• Not considering compounding interest