P. 12 Simple interest E7Y Stanley has \( \$ 400 \) in a savings account that earns \( 10 \% \) annually. The interest is not compounded. How much will he have in total in 1 year? Use the formula \( i= \) prt, where \( i \) is the interest earned, \( p \) is the principal (starting amount), \( r \) is the interest rate expressed as a decimal, and \( t \) is the time in years.

To find out how much total money Stanley will have in one year, we first need to calculate the interest. Using the formula \( i = prt \): 1. Here, \( p = 400 \), \( r = 0.10 \), and \( t = 1 \). 2. Plugging in these values gives us \( i = 400 \times 0.10 \times 1 = 40 \). Now, we add the interest to the principal amount: \( 400 + 40 = 440 \). So, Stanley will have \( \$ 440 \) in total after one year! Looking beyond the numbers, this scenario showcases the power of saving and earning interest. Even though it’s simple interest, understanding it lays a solid foundation for tackling more complex financial concepts. One day, Stanley might learn about compound interest, where the earnings start working for him too! When dealing with simple interest, a common mistake is forgetting to convert the interest rate into decimal form. Often, people mistakenly write \( 10 \% \) as \( 10 \) instead of \( 0.10 \). Always remember: divide by \( 100 \) to turn percentages into decimals! This small step is crucial to getting the right answer.