An investment of $10 000 at 4% p.a. simple interest builds to $11 000. The number of months it takes to reach this amount is?

I was just wondering if the answer is 30 months.

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- Oct 9th 2008, 05:40 AMxwrathbringerxSimple Interest
An investment of $10 000 at 4% p.a. simple interest builds to $11 000. The number of months it takes to reach this amount is?

I was just wondering if the answer is 30 months. - Oct 9th 2008, 06:22 AMTKHunny
If you were to demonstrate your calculation, I expect it would clear up your wondering.

Empirical Formula

I = Prt -- Right?

Given Information

I = 11000 - 10000 = 1000

P = 10000

r = 0.04

Algebra

t = I/(Pr) = 1000/(10000*0.04) = ??? years = ?? Months - Oct 9th 2008, 06:28 AMxwrathbringerx
It was just that this was a multiple choice question with the options:

(A) 330

(B) 27.5

(c) 273

(D) 23

But no matter how many times I worked out the question using SI = Prt, it worked out to be 30, so I just wanted to make sure I wasn't getting dumber. (Rofl)