Steve invested $5,000 for two years. The rate of annual interest in the first year was 7 percent, and was 8.5 percent in the second year. How much interest did Steve earn at the end of the two year period?

First solve for the interest gained at the end of the first year: 7 percent * 5,000 = $350 Then solve for second year interest: 8.5 percent * (5000 + 350) = $454.75 Then add the two totals to find total interest at the end of the two year period.

Asked by Tom Tennant · Last updated 5 years ago · 1.5K views · SOURCE