Problem
Previous Page Next Page Page 2 of 6 Question 2 (1 point) Charlie deposited $\$ 2600$ from an account that pays $5.4 \%$ simple interest. Determine how much SIMPLE interest Charlie will earn after 42 months (HINT: $t=$ 42/12). NOTE: You will need the Simple Interest formula. I = PRT (NOT your TVM solver!!) BE SURE TO TYPE you answers in the form: \$\#\#\#\# (For example, \$208.10) A
Solution
Step 1 ：Charlie deposited $2600 in an account that pays 5.4% simple interest.
Step 2 ：We are asked to determine how much simple interest Charlie will earn after 42 months. We are given a hint that \(t = \frac{42}{12}\).
Step 3 ：We will use the Simple Interest formula \(I = PRT\).
Step 4 ：Substitute \(P = 2600\), \(R = 0.054\), and \(T = \frac{42}{12}\) into the formula.
Step 5 ：Calculate the interest \(I = 2600 \times 0.054 \times \frac{42}{12}\).
Step 6 ：The calculated simple interest is approximately $491.40. This is the amount of interest that Charlie will earn after 42 months.
Step 7 ：Final Answer: \(\boxed{\$491.40}\)
