Question

Simple interest , 750 principal, 11 years, total interest due 412.5, interest rate = ?%

Answer 1

The interest rate is 5%.

Explanation

The appropriate formula to use here is as follows:

i = simple interest = p*r*t.

Let's solve this for i: divide both sides of the equation by p*t:

i

------ = r

p*t

Subbing $412.5 for i, $750 for p and 11 yrs for t, we get:

$412.50

-------------- = 0.05.

($750)(11)

The interest rate is 5%.