Question

The principal P is borrowed and the loan's future value A at time t is given. Determine the loan's simple interest rater.
P = $9000.00, A = $12150.00, t = 5 years
% (Round to the nearest tenth of a percent as needed.)

Answer 1

Interest rate = 7%

I= PRT where I is the interest earned, p is the principal, r is rate as a decimal, and t is time in years.


A - P will give us the interest earned.

12,150 - 9,000 = 3,150

3150 = (9000)(r)(5)
3150 = 45,000r
r = 0.07
r = 7%