Remember that
The simple interest formula is equal to
[tex]A=P\mleft(1+rt\mright)[/tex][tex]I=P\mleft(rt\mright)[/tex]where
A is the Final Investment Value
P is the Principal amount of money to be invested
r is the rate of interest
t is Number of Time Periods
in this problem we have
P=$875
r=5 1/4%=5+1/4=5.25%=5.25/100=0.0525
t=3 years
substitute
[tex]\begin{gathered} I=875\cdot(0.0525\cdot3) \\ I=\$137.81 \end{gathered}[/tex]The new balance is
A=P+I
A=875+137.81
