Determine the number of years required for $745 to earn $59.60 simple interest at 8% p.a.    
Question 3 Answer

a.
1.5 years

b.
1 year

c.
1 years 1 month

d.
2 years

To determine the number of years required for $745 to earn $59.60 in simple interest at an annual rate of 8%, we can use the simple interest formula:

\[
\text{Interest} = P \times r \times t
\]

Where:
- $ \text{Interest} = 59.60 $
- $ P = 745 $ (the principal amount)
- $ r = \frac{8}{100} = 0.08 $ (the annual interest rate)
- $ t $ is the time in years (which we need to find)

Plug the known values into the formula and solve for $ t $:

\[
59.60 = 745 \times 0.08 \times t
\]

First, calculate $ 745 \times 0.08 $:

\[
745 \times 0.08 = 59.6
\]

Now, the equation becomes:

\[
59.60 = 59.6 \times t
\]

Solve for $ t $:

\[
t = \frac{59.60}{59.6} = 1
\]

So, the time required is **1 year**.

The correct answer is **b. 1 year**.

Would you like further details or have any other questions? Here are five related questions you might find interesting:

1. How would the time required change if the interest rate were lower?
2. What is the impact of principal amount on the time required to earn a specific interest?
3. How does simple interest compare to compound interest over long periods?
4. How can you use the simple interest formula to calculate the principal required for a desired interest in a given time?
5. What happens if the interest rate changes midway through the investment period?

**Tip:** When solving for time in the simple interest formula, remember that the interest rate should always be expressed as an annual rate, unless stated otherwise.

Learn how to calculate the time required for $745 to earn $59.60 in simple interest at an annual rate of 8%. This problem involves applying the simple interest formula and solving for time. Suitable for high school students.

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