What is the simple interest earned on $200 at 5% for 2 years?

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Multiple Choice

What is the simple interest earned on $200 at 5% for 2 years?

Explanation:
Simple interest is found by multiplying the principal by the annual rate and the time in years. Use I = P × r × t, with P = 200, r = 0.05 (5%), and t = 2. Compute: 200 × 0.05 × 2 = 200 × 0.10 = 20. So the interest earned is $20. The other numbers would require changing the rate or time, but with the given values you get exactly 20.

Simple interest is found by multiplying the principal by the annual rate and the time in years. Use I = P × r × t, with P = 200, r = 0.05 (5%), and t = 2. Compute: 200 × 0.05 × 2 = 200 × 0.10 = 20. So the interest earned is $20. The other numbers would require changing the rate or time, but with the given values you get exactly 20.

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