The simple interest on the principal amount of $725 at a rate of 3.25% for 6 months is $736.78
What is simple interest?
Simple interest is calculated on the loan principal amount or the initial deposit into a savings account. It can be determined by using the formula:
[tex]\mathbf{S.I = P(1 + rt)}[/tex]
where:
- P = principal = $725
- R = rate = 3.25%
- T = time = 6 months = 0.5 years
[tex]\mathbf{S.I = 725(1 + 0.0325(0.5))}[/tex]
S.I = $736.78
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