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A bank offers [tex]5\%[/tex] simple interest per annum.

Hannah invests [tex]£250[/tex] for 4 years.

Calculate the total amount after 4 years.

Sagot :

GinnyAnswer
To determine how much Hannah will have after investing £250 for 4 years with a simple interest rate of 5% per annum, follow these steps:

1. Identify the given values:
- Principal (P): £250
- Interest rate (r): 5% per annum (which is 0.05 in decimal form)
- Time period (t): 4 years

2. Calculate the simple interest:
Simple interest (SI) is computed using the formula:
[tex]\[ SI = P \times r \times t \][/tex]

- Substitute the given values into the formula:
[tex]\[ SI = 250 \times 0.05 \times 4 \][/tex]

- Perform the multiplication to find the simple interest:
[tex]\[ SI = £50 \][/tex]

3. Calculate the total amount after 4 years:
The total amount (A) is the sum of the principal and the simple interest.
[tex]\[ A = P + SI \][/tex]

- Substitute the principal and the simple interest into the formula:
[tex]\[ A = 250 + 50 \][/tex]

- Add the values to find the total amount:
[tex]\[ A = £300 \][/tex]

Therefore, after 4 years, Hannah will have a total amount of £300.
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