A deposit of HK\$50,000 earns simple interest at 2% per year. How much interest is earned in 3 years?
Answer and explanation
Correct answer: B. HK\$3,000
- Step 1: Simple interest = P × r × t = HK\50,000 × 0.02 × 3 = HK\.
Answer
HK\$3,000.
Why not the others: HK\$3060.4: compound interest is calculated instead of simple interest. HK\$1,000: it gives one year of interest only. HK\$53,000: it gives the total amount, not the interest.
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