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amberpatterson9
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What annual simple interest rate will allow Hosea Soli to increase his initial investment of $80,000 to $100,000 in five years? (Hint: Use the formula I = prt and substitute known values to find I.)


A)6%

B)5%

C)6.25%

D)5.5%

Verified Answer :

Abbygal

Using the formula I=prt
I will use $80,000 for p or principle.
I will use 5% for r or rate. (this needs to be converted to a decimal so move the decimal point two places to the left, you can't multiply using percents)
and 5 years for t or time.

80,000*0.05*5=20,000.00. He is getting $20,000 in interest. So $80,000 + $20,000 = $100,00.
Therefore, the answer is B.

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