Question

An investment of $4000 earns $1700 simple interest after 5 years. what is the annual simple interest rate in the investment?

Answer 1

8.5% interest rate

Explanation:

Principle: $4000

Interest rate: x

Time : 5 years

4000( 5 ) ( x ) = Interest

4000x = 1700/5

4000x = 340

x = 0.085 or 8.5% interest rate

Check:

8.5% x 4000 x 5

= 340 x 5

= 1700