You deposit $2000 in an account that earns simple interest at an annual rate of 4%. How long must you leave the money in the account to earn $500 in interest?

The simple interest formula for the accumulated balance is:

Prt = I

We are given P = 2,000, r = 0.04, and I = 500.

2000(0.04)t = 500

80t = 500

Divide each side by 80

t =

The simple interest formula for the accumulated balance is:

Prt = I

We are given P = 2,000, r = 0.04, and I = 500.

2000(0.04)t = 500

80t = 500

Divide each side by 80

t =

**6.25 years**

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