00:01
For the first part of this problem, we want to calculate simple interest on an amount of $48 ,000.
00:11
The type of interest is simple interest.
00:20
The duration was four years, and the interest rate was 5 .6%.
00:33
So to calculate simple interest, we use the formula i equals p.
00:39
R t.
00:41
So the p stands for the principal and our principal is our amount.
00:48
Our r stands for our rate and the time is the amount or the t stands for time which is measured in years.
00:59
So we're going to substitute those values in.
01:02
So we'll do 48 ,000.
01:05
Our interest rate we're going to display our decimal as a percent, which is 0 .056.
01:12
And our time is four.
01:15
So our interest will be $10 ,752.
01:23
Now your second part of this problem is asking us to work with an amount of $30 ,000.
01:34
The type of interest is going to be compounding daily.
01:44
The duration is five years and our interest rate.
01:54
Is 5 .0%.
01:57
So since this is compound interest, we're going to use a different formula.
02:01
The formula we're going to use is a equals p times the quantity of 1 plus r over n, and that quantity is raised to the n times t power...