Question

Johnnie Rox borrowed $3,500.00 to tile his house. He agreed to pay back $4,000.00 in 180 days. What ordinary interest rate was he paying? (Round your answer to the nearest tenth of a percent.)

12.5%


25.0%


3.0%


28.6%

Answer 1

28.6

Explanation:

Answer 2

28.6 %

Explanation:

Principal = $3,500.00

Amount = $4,000.00

Simple Interest = Amount - Principal = $4,000.00-$3500.00=$500

Time = 180 days =
`(180)/(30 * 12)` =0.5

Formula :
`S.I. = (P * R * T )/(100)`

Where P is principal

R is rate in Percent

T = time in years

Substitute the values:

`500 = (3500 * R * 0.5 )/(100)`

`(500\cdot100)/(3500\cdot0.5) =R`

`28.6\% =R`

Hence he is paying 28.6 %