Multiple choice

If $8,000 is invested at 6 percent simple annual interest, how much interest is earned after 3 months?

  1. $120
  2. $280
  3. $240
  4. $160
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A Correct answer
Explanation

Interest = Principal * Rate * Time. Principal = 8000, Rate = 0.06 per year, Time = 3/12 = 0.25 years. Interest = 8000 * 0.06 * 0.25 = 120.

AI explanation

Using the simple interest formula, the time of 3 months converts to 0.25 years. The interest is calculated as 8000 multiplied by 6 and by 0.25, all divided by 100. This results in a total interest of $120.

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