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Simple interest means that there is no compounding during the period in question. However you have not said if 7% is the annual rate of interest or the amount of interest that will be earned during the two year period.

If 7% is an annual rate then the answer is $700. If it is 7% for the two year period then the answer is $350.

If 7% is an annual rate then the answer is $700. If it is 7% for the two year period then the answer is $350.

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how did u get this answer? this is a ? on the GED test, I am so bad at math! how did u come up with $700? Somehow I did come up with $350 but that was the wrong answer it was $700. so how did u come up with that answer for 1 and 2 whats the difference between annual rate, or amount earned during this 2 year period? I dropped our of H.S because I was so behind in my math credits I was a senior in a algebra 1a class (like middle school algebra and I still had a hard time) so I dropped out knowing I wouldnt graduate with my class, went on to make $ in a more physical skilled job which is my cup of tea then brain work lol but now im married and been a stay at home mom with 2 boys since 2009 one is 3 one is 1 1/2 so im starting to get my GED process along so I can go to college to help my husband make some money for this family, Im so out of touch with school expeshially math.

mmpconover Nov 27, 2012

.7 x 5000.00. I am trying to get my GED as well. I have learned that if something is say, 20% off and the item is say $10.00 . you find the answer by taking 20 cents of each dollar. So it would be $2.00 off $9.00. So on the interest Question it would be 7 cents for each dollar. Hope that helps.

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