You want to put some money into a simple interest account. it pays 5% interest annually for 4 years. you would like to earn $600 in interest. how much money do you need to put in?

We will use the formula for simple interest.

I = PRT

where I is interest, P is principal, R is rate of interest and T is time.

P = I / RT

P =  600 / 4 × 5%

We need to write 5% as a decimal fraction → 5/100 = 0.05

Therefore,

P = 600 / 4 × 0.05

P = 600 / 0.2

p = 3000

You would need to put in $ 3000  in order to earn a $ 600 interest after 4 years at the annual interest rate of 5%.