Question

You need to borrow $18,000 to buy a new car. You are willing to pay $4000 in interest over the life of the loan, and you want to repay the loan in three years. What simple interest rate do you need to meet your goal?

Answer 1

7 11/23%

Explanation:

To find rate u use the method of finding simple interest

Simple interest= Principal× Rate × Time

SI=PRT/100

$4000=$18000×r×3yrs/100

Now u divide 100 by 18000

To do that u cancel out all the zeros

Now u remain with;-

$4000=$180×r×3yrs

$4000= $540×r

Now u divide;-

$4000/540=540×r/540

The answer is 7 11/23%