Question

Santiago buys a new computer for $3000. He pays it off in 2 years and pays $480 in simple interest. What was the interest rate?

Answer 1

8%

Explanation:

We can solve this by making use of the simple interest formula

I= PRT/100

480= 3000×R×2/100

480= 6000R/100

Cross multiply

48000= 6000R

R= 48000/6000

= 8%

Hence the rate is 8%