The value of I is 4800.

I = (8000)(0.6)(1) = 4800.

Investment problems usually involve simple annual interest (as opposed to compounded interest), using the interest formula **I = Prt**, where *I* stands for the interest on the original investment, *P* stands for the amount of the original investment (called the "principal"), *r* is the interest rate (expressed in decimal form), and *t* is the time.

For annual interest, the time t must be in years. If they give you a time of, say, nine months, you must first convert this to 9/12 = 3/4 = 0.75 years. Otherwise, you'll get the wrong answer.

Investment word problems are not generally terribly realistic; in "real life", interest is pretty much always compounded somehow, and investments are not generally all for whole numbers of years.

To learn more, see PurpleMath.com's "Investment" Word Problems.