You put $1,200 in a 6-month Certificate of Deposit paying 4% simple interest. What is the maturity value of your CD?

To determine the maturity value of a Certificate of Deposit (CD), you can use the formula for simple interest, which is:

[ \text{Interest} = \text{Principal} \times \text{Rate} \times \text{Time} ]

In this scenario, the principal amount is $1,200, the annual interest rate is 4% (or 0.04 when expressed as a decimal), and the time period is 6 months, which is equivalent to 0.5 years.

Calculating the interest earned during this period involves plugging the values into the formula:

1. Calculate the interest:

[ \text{Interest} = 1,200 \times 0.04 \times 0.5 ]

[ \text{Interest} = 1,200 \times 0.02 ]

[ \text{Interest} = 24 ]

2. Now, to find the maturity value of the CD, you add the earned interest to the principal:

[ \text{Maturity Value} = \text{Principal} + \text{Interest} ]

[ \text{Maturity Value} = 1,200 +