SAVINGS Nolan has a savings account with a current balance of $1500. What would be Nolan's account balance after 4 years if he receives 5% interest
annually?

Nolan's account balance would be $1800 after 4 years

Step-by-step explanation:

Simple Interest

Interest is calculated only on the original principal of a loan or on the balance of an account.

Unlike compound interest where the interest earned in the compounding periods is added to the new principal, simple interest only considers the principal to calculate the interest.

The interest earned is calculated as follows:

I=P.r.t

Where:

I=Interest

P=initial principal balance

r=interest rate

t=time

Nolan has a savings account that pays r=5% = 0.05 with an initial balance of P=$1500. It's required to find the account's balance after t=4 years.

Substituting in the formula:

I = $1500 * 0.05 * 4

I = $300

The final balance is:

A = P + I = $1500 + $300 = $1800

Nolan's account balance would be $1800 after 4 years

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