Question

Lily took out a 5-year loan from the bank for 31000.00 to purchase a new car. At the end of the loan, she paid a total of 37975. Find the interest rate on the loan.

Answer 1

24.5%

Explanation:

Simple Interest = (principal×rate×time)÷100. *Brackets First*

Transpose the formula to make rate the subject: rate= (100×simple interest) ÷ (principal×time).

Plug in values: rate = (100×37975) ÷ (31000×5).

The result is 24.5%.