Question

An elite private college receives large donations from successful alumni. The account that holds these donations now has $955 million. How much would the account earn in 1 year of simple interest at a rate of 2.33%? Round to the nearest cent.

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An elite private college receives large donations from successful alumni. The account that holds these donations now has 955955 million USD.We have to calculate,how much would the account earn in 1 year of simple interest at a rate of 2.33%2.33\%? To calculate interest we will use the equation,

I=Ptr\begin{align*} I=Ptr \end{align*}

where is PP principal, rr interest rate and tt number of years, so we get,

I=9550000000.02331=21965000USD\begin{align*} I=955 000 000\cdot 0.0233\cdot 1=21965000\,\,\text{USD} \end{align*}

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