The simple interest rate will be 19.2% per year.
We need to find the simple interest which is I = P * R * T
where,
I is the interest,
P is the principal,
R is the interest rate and
T is the time period.
Here, I = the amount you payed - the amount that you owed
= $1800 - $1300 = $500
Now, I = 500
T = 2 years
P = 1300
According to the formula,
500 = 1300 * R * 2
⇒ 500 = 2600* R
∴R = 500/2600 = 0.1923
Multiplying it by 100, we get 19.23%.
Rounding off 1 decimal place, we get 19.2%.
Therefore, you will pay simple interest rate of 19.2% per year.
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