How much interest will you earn on a $10,000 investment in a CD with 0.25% interest after two years?

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To determine how much interest you will earn on a $10,000 investment in a CD (Certificate of Deposit) with an annual interest rate of 0.25% over two years, you can use the formula for simple interest, which is:

Interest = Principal × Rate × Time

In this case:

• The principal is $10,000,

• The rate is 0.25% (which, when expressed as a decimal for calculations, is 0.0025),

• The time period is 2 years.

Now, applying the formula:

Interest = $10,000 × 0.0025 × 2

Calculating this step by step:

1. First, calculate the interest for one year:

$10,000 × 0.0025 = $25.

2. Then, for two years:

$25 × 2 = $50.

Thus, the total interest earned on a $10,000 investment at 0.25% over two years is $50. This indicates that the answer is indeed the correct calculation based on the parameters given. The option that reflects this amount accurately is the one chosen.