quarterly interest

[jenniedepue]

Need help with this problem.


Find the quarterly interest paid on a savings account if the bank pays 5% a year and the lowest balance for that quarter was $875.

Peteriece

 

[TchrQbic]

Need help with this problem.


Find the quarterly interest paid on a savings account if the bank pays 5% a year and the lowest balance for that quarter was $875.

Peteriece

Interest is calculated using this formula:

I = P*r*t, with I the interest, P the principal (the balance in the account), r the percentage rate per year, and t the time in years. * indicates multiplication. For this problem, since the interest is calculated quarterly, use 1/4 or .25 for the time (one-fourth of a year, or one quarter).