An amount of N550,000.00 was realized when a principal, x was saved at 2% simple interest for 5 years. Find the value of x

Answer Details

The formula to calculate simple interest is: Simple Interest = Principal x Rate x Time where Rate is the interest rate per year and Time is the number of years. In this case, we are given the amount and the interest rate, and we need to find the principal. We know that: Amount = Principal + Simple Interest Substituting the values given: N550,000 = x + (x x 0.02 x 5) Simplifying: N550,000 = x + 0.1x N550,000 = 1.1x Dividing both sides by 1.1: x = N500,000 Therefore, the value of the principal is N500,000. Hence, the correct answer is N500,000.