Questions: If 22,000 is invested in an account for 10 years. Calculate the total interest earned at the end of 10 years if the interest is: 7% simple interest=

Solution Steps

To calculate the total interest earned with simple interest, we use the formula:
\[ \text{Simple Interest} = P \times r \times t \]
where \( P \) is the principal amount (\$22,000), \( r \) is the annual interest rate (7\% or 0.07), and \( t \) is the time in years (10 years). We will plug these values into the formula to find the total interest earned.

We are given the following values:

• Principal amount \( P = 22000 \)
• Annual interest rate \( r = 0.07 \)
• Time in years \( t = 10 \)

The formula for calculating simple interest is given by: \[ \text{Simple Interest} = P \times r \times t \]

Substituting the known values into the formula: \[ \text{Simple Interest} = 22000 \times 0.07 \times 10 \]

Calculating the above expression: \[ \text{Simple Interest} = 22000 \times 0.07 \times 10 = 15400 \]

Final Answer