QuestionAugust 17, 2025

For a certain CD, the initial investment is 1,120 and the annual interest rate is 2.5% How much interest is earned in year one? Year One Interest= [?] Year Two Interest= square Total Interest= square Do not round-your answer.

For a certain CD, the initial investment is 1,120 and the annual interest rate is 2.5% How much interest is earned in year one? Year One Interest= [?] Year Two Interest= square Total Interest= square Do not round-your answer.
For a certain CD, the initial investment is 1,120 and the annual interest rate is 2.5% How much interest is earned in year one? Year One Interest= [?] Year Two Interest= square Total Interest= square Do not round-your answer.

Solution
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Answer

Year One Interest = \28 ### Year Two Interest = \28 ### Total Interest = \56 Explanation 1. Calculate Year One Interest Use the formula for simple interest: **I = P \times r \times t**. Here, P = 1120, r = 0.025, and t = 1. So, I = 1120 \times 0.025 \times 1 = 28. 2. Calculate Year Two Interest Since it's a CD with simple interest, the interest remains the same each year. Therefore, Year Two Interest is also 28. 3. Calculate Total Interest Add the interest from both years: 28 + 28 = 56.

Explanation

1. Calculate Year One Interest<br /> Use the formula for simple interest: **$I = P \times r \times t$**. Here, $P = 1120$, $r = 0.025$, and $t = 1$. So, $I = 1120 \times 0.025 \times 1 = 28$.<br /><br />2. Calculate Year Two Interest<br /> Since it's a CD with simple interest, the interest remains the same each year. Therefore, Year Two Interest is also $28$.<br /><br />3. Calculate Total Interest<br /> Add the interest from both years: $28 + 28 = 56$.
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