Miss Matsheka wants to invest R12,000.00 into her savings account for 5 years. She will earn 10% simple interest per annum.

Use the information above and answer the questions that follow.

1.1.1 Identify the interest rate for the investment.

1.1.2 How much will Miss Matsheka have in total after 5 years?



Answer :

Sure, let's break down the problem step-by-step.

### Given Information:
- Principal amount (initial investment): R12,000
- Time period: 5 years
- Simple interest rate per annum: 10%

### Solution:

#### 1.1.1 Identify the interest rate for the investment.
The interest rate for the investment is clearly stated as 10% per annum.

#### 1.1.2 How much will Miss Matsheka have in total after 5 years?
To find out the total amount that Miss Matsheka will have after 5 years, we need to first calculate the simple interest she will earn over this period and then add it to her principal amount.

Step 1: Calculate the Simple Interest
Simple Interest can be calculated using the formula:
[tex]\[ \text{Simple Interest} = \text{Principal} \times \text{Rate} \times \text{Time} \][/tex]

Where:
- Principal (P) = R12,000
- Rate (R) = 10% per annum = 0.10 (as a decimal)
- Time (T) = 5 years

Using the formula,
[tex]\[ \text{Simple Interest} = 12,000 \times 0.10 \times 5 \][/tex]
[tex]\[ \text{Simple Interest} = 12,000 \times 0.50 \][/tex]
[tex]\[ \text{Simple Interest} = 6,000 \][/tex]

So, Miss Matsheka will earn R6,000 in interest over 5 years.

Step 2: Calculate the Total Amount after 5 years
The total amount after 5 years can be found by adding the interest earned to the principal amount.
[tex]\[ \text{Total Amount} = \text{Principal} + \text{Simple Interest} \][/tex]

Using the values,
[tex]\[ \text{Total Amount} = 12,000 + 6,000 \][/tex]
[tex]\[ \text{Total Amount} = 18,000 \][/tex]

Therefore, Miss Matsheka will have R18,000 in total after 5 years.